Se ng the Stage:
Visuals: U lize a large screen with clear, concise slides (as previously outlined).
Energy: Maintain a professional but enthusias c demeanor.
Flow: Ensure a smooth transi on between speakers and topics.
The Role-Play Script:
(Scene: IndiGo Airlines Boardroom. Bodhisa wa, Ankan, Bepari, Aniket, Ankan (Board), and Prasomit
are seated.)
Bodhisa wa (CFO): (Stands, confident and composed) "Good morning, everyone. Today, we're here
to discuss a pivotal decision for IndiGo's future: the acquisi on of 10 Airbus A320 aircra . We have
two op ons on the table: leasing and purchasing via loan financing. Let's delve into the financial
implica ons of each."
(Slide 1: Title Slide – IndiGo Airlines: Lease vs. Buy)
Bodhisa wa: "As you see, the asset in ques on is 10 Airbus A320 aircra . Op on 1, Lease, has
annual lease payment of 80 crore per aircra , with lease term of 6 years, maintenance included and
no ownership at the end. Op on 2, Buy, has the purchase price of 500 crore per aircra , loan interest
rate of 10% per annum, loan tenure of 6 equal installments in 6 years, deprecia on at 20% and tax
rate at 40%"
(Slide 2: Lease Op on Details)
Bodhisa wa: "Bepari, can you walk us through the lease op on?"
Bepari (Finance Manager): (Stands, calm and ar culate) "Certainly. Leasing offers us a streamlined
approach. With an annual payment of ₹80 crore per aircra , our total outlay over six years would be
₹4,800 crore. Maintenance is included, elimina ng opera onal uncertain es. Crucially, it requires
minimal upfront capital, preserving our liquidity. This is a short term opera ng lease, as you can see
in the slides. The biggest advantage is flexibility."
(Slide 3: Buy Op on Details)
Bodhisa wa: "Thank you, Bepari. Now, let's examine the buy op on. Ankan, our CEO, has a strong
vision for this."
Ankan (CEO): (Stands, passionate and visionary) "Indeed. Acquiring these aircra is a strategic
impera ve. It's about building long-term value, securing our assets, and enhancing our compe ve
edge. While the ini al investment is substan al—₹5,000 crore—we must consider the long-term
benefits. We will own these assets."
(Slide 4: Financial Analysis – Lease vs. Buy)
Bodhisa wa: "Now, let's look at the numbers. As you can see, the lease op on, while seemingly
straigh orward, incurs a total cost of ₹4,800 crore over six years. The buy op on, however, presents
a different picture."
(Slide 5: Detailed Buy Op on Calcula ons)
Bodhisa wa: "Here, we have a detailed amor za on schedule. With an annual payment of
approximately ₹1,143 crore, we benefit from significant tax shields. Deprecia on alone saves us ₹400
crore annually. And the interest tax shield, while varying, further reduces our net ou low. A er
accoun ng for these, the total net cost over six years is significantly lower than leasing. Around 3500
Crore. We will be providing the detailed calcula ons in the presenta on."
(Drama c Pause)
Bodhisa wa: "While the upfront investment is higher, the buy op on ul mately saves us a
substan al amount of money. It's an investment, not just an expense."
Aniket (Board Member): "Bodhisa wa, the debt burden is a concern. How will this impact our
financial stability?"
Bodhisa wa: "That's a valid point, Aniket. We've conducted a thorough risk assessment. Our
projec ons indicate that IndiGo's strong cash flow and profitability will easily cover the loan
repayments. Moreover, owning these assets strengthens our balance sheet."
Ankan (Board Member): "Bepari, what about the opera onal risks of owning the aircra ?
Maintenance, obsolescence—these are significant factors."
Bepari: "Absolutely. We've factored in maintenance costs. Our analysis shows that even with these
costs, the buy op on remains more cost-effec ve. As for obsolescence, we'll implement a robust
maintenance and upgrade program to ensure the aircra remain efficient and compe ve."
Prasomit (Board Member): "Ankan, what's your long-term vision for these aircra ?"
Ankan (CEO): "These aircra are integral to our expansion plans. They'll enable us to increase our
network capacity, enhance our service offerings, and solidify our market leadership. We're not just
buying aircra ; we're inves ng in IndiGo's future."
Bodhisa wa: (Addressing the board) "In conclusion, while leasing offers flexibility, the buy op on
provides significant financial advantages and long-term strategic benefits. It's a calculated move that
will strengthen IndiGo's posi on in the avia on industry. We recommend approving the purchase of
the 10 Airbus A320 aircra through loan financing."
(Slide 6: Recommenda on and Conclusion)
Bodhisa wa: "We are now open for ques ons."
(Open the floor for ques ons. Engage ac vely and confidently.)
