InterGlobe Aviation Ltd. share price target

We increase our FY26E/FY27E PAT estimates by 13%/10% as we fine tune our yield and fuel CASK assumptions. INDIGO reported better than expected performance with FX adjusted EBITDAR margin of 30.8% (PLe 28.5%) led by 1) 2.2% rise in yield to Rs5.32 aided by Maha Kumbh and 2) 6.6% fall in fuel CASK to Rs1.60 amid benign ATF prices. Notwithstanding near-term challenges amid the ongoing geo-political tensions, ASKM growth guidance of mid-teens for 1QFY26E is encouraging. Further, we expect the overall pricing environment to remain stable with yields of Rs5.1 over next 2 years as the aviation market is...

Our initial estimates factored in spread compression in FY25 vs. FY24. While, in H1FY25, this played out more than we expected, there was a big recovery in H2.

We recommend a BUY on the stock with a target price of Rs 5,800/share, implying an upside of 10% from the CMP.

We remain optimistic about InterGlobe Aviation’s long-term growth trajectory, supported by its leadership in India’s aviation market, sustained profitability, and clear roadmap for international expansion.

increase capacity by early double digits 3) expand the network by launching 14 supply chain issues faced by aircraft manufacturers, capacity addition growth guidance of early double digits is positive. Nonetheless, as AoG count is expected to fall to 40's by start of FY26E and organic fleet addition guidance is healthy, a slightly better outlook on ASKM guidance would have been comforting. However, commentary on yields was positive (expectation of low...

India’s aviation boom: The Indian aviation industry is witnessing a rapid expansion, with domestic air travel set to double by CY30. This growth will be driven by a rising middle class, increasing disposable incomes, and government-led infrastructure projects.

INDIGO reported flat YoY EBITDA at INR51.6b and PAT of INR24.4b (est. INR36.9b) in 3QFY25. Excl. forex loss/gain, EBITDA was 5% above our estimate

Indigo posted robust results in Q3FY25, with SA EBITDA of Rs66.2bn – a 15% beat. This was driven by a 3% beat each on RASK/yields, while fuel cost and rentals were also lower.

INDIGO reported a 26% YoY decline in EBITDA to INR16.2b in 2QFY25 and a net loss of INR9.9b (vs. our est. net loss of INR6.8b).

InterGlobe Aviation (IndiGo) has expanded its domestic network to 88 destinations and added new international routes, including 7 new destinations, while navigating fuel price volatility and economic risks.

The new initiatives will further cement IndiGo’s strategy of “Towards new heights and cross new frontiers” which it started in 2022 and had seen the company placing the largest-ever single aircraft order.

Our positive stance on InterGlobe Aviation (IndiGo) stays unchanged, premised on the conducive supply-demand balance in India’s domestic aviation.

InterGlobe Aviation (INDIGO) reported an EBITDA growth of 4% YoY to INR51.5b in 1QFY25, while PAT declined 12% YoY to INR27.3b.

INDIGO reported EBITDA growth of 45% YoY to INR39.8b in 4QFY24, while
PAT more than doubled to INR18.9b (vs. our est. of INR23.7b). Revenue
passenger kilometers (RPK) at 30b. Passenger load factor (PLF) was 86.2%
with available seat kilometers (ASK) of 34.8b (est. 33.9b) and yield at INR5.2
(vs. est. of INR4.9, +7% YoY) in 4Q.

We reiterate our positive stance on Indigo, hoisting up our TP by ~34% to
Rs4,700 and rating to BUY from Add.