InterGlobe Aviation Limited, the parent company of India’s largest airline, IndiGo, announced on Thursday a record-breaking profit of ₹919.2 crore in the March quarter, attributing the success to the robust demand for air travel experienced during this period.
Year of Recovery and Growth
During a post-earnings conference call, the airline’s management declared the previous financial year as a period of recovery and growth for the company. Looking ahead, they expressed confidence in the airline’s future prospects, citing strong forward bookings and plans to expand its operations further in Central and South Asia, as well as the Middle East.
In line with these ambitious growth targets, IndiGo aims to hire an additional 5,000 employees and plans to double its size by the year 2030.
Record High Air Passenger Traffic
These impressive financial results come at a time when the average daily air passenger traffic in the Indian civil aviation market reached 420,000 during the quarter. This figure surpasses the daily air passenger traffic recorded in the pre-pandemic year of 2019, as reported by the Directorate General of Civil Aviation, India’s civil aviation regulator.
According to Pieter Elbers, CEO of IndiGo, the combination of robust market demand and focused execution of their strategic initiatives resulted in strong operational and financial performance.
He stated, “This was the second consecutive quarter wherein we produced strong operational and financial results, as we reported the highest ever fourth-quarter net profit.”
IndiGo’s total income for the quarter surged by 78% year-on-year, reaching ₹14,600 crore. This remarkable growth contrasts with the impact of the COVID-19 pandemic on the company’s performance in the March quarter of the previous financial year.
At that time, dampened travel sentiment due to the surge in COVID-19 cases caused by the Omicron variant led to a net loss of ₹1681.8 crore and a total income of ₹8207.5 crore.
IndiGo’s yield, which represents the revenue earned per paying passenger flown per kilometre, also saw an increase. The yield rose to ₹4.85 per km compared to ₹4.40 per km in the same quarter of the previous year.
Looking ahead to the June quarter of the 2023-24 financial year, the low-cost carrier expects a 5-7% increase in total capacity, measured in available seat kilometres or passenger carrying capacity, compared to the March quarter of the previous year.
Strong Recovery from Previous Financial Year
For the financial year 2022-23, InterGlobe Aviation reported a net loss of ₹305.8 crore. However, this loss represents a significant improvement compared to the net loss of ₹6161.8 crores reported in the previous financial year ending in March 2022.
The company’s management sees this as a positive sign of the airline’s recovery and growth trajectory.
Expansion and Fleet Update
As of March 31, 2023, IndiGo’s fleet consisted of 304 aircraft, including 21 A320 CEOs (current engine option), 162 A320 Neos (new engine option), 79 A321 Neos, 39 ATRs, two A321 freighters, and one Boeing 777 on a wet lease arrangement. Notably, the airline added two aircraft to its fleet during the quarter, demonstrating its commitment to expanding its operations.
Market Performance and Share Price
Following the announcement of the impressive financial results, IndiGo’s shares experienced a slight decline. On Thursday, the company’s share price closed 1.57% lower at ₹2,264 on the Bombay Stock Exchange (BSE). This marginal decrease may be attributed to various factors impacting the stock market and investor sentiment.
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