InterGlobe Aviation Ltd (IndiGo) Company Analysis

INDIGO InterGlobe Aviation Ltd operates IndiGo, India’s largest airline by domestic market share. Its business model focuses on affordable air travel, high aircraft utilisation, operational efficiency and a large domestic and international route network. The company benefits from rising passenger traffic, increasing air-travel penetration and expansion into international markets. Q2 FY27 results show strong revenue growth but continued profitability pressure. Revenue from operations increased 25.9% year-on-year to approximately ₹23,364 crore. However, passenger numbers declined 4.7% to 27.5 million, and the passenger load factor fell from 82.5% to 80.3%. Yield improved 34.3%, indicating higher revenue earned per passenger kilometre. Despite this, the company reported a consolidated net loss of approximately ₹1,879 crore, compared with a loss of ₹2,582 crore in Q2 FY26. The loss excluding foreign-exchange impact was approximately ₹724 crore, compared with a profit of ₹104 crore in the previous-year quarter. The biggest concern is the sharp increase in operating costs. Fuel cost per available seat kilometre rose 68.9%, while non-fuel cost per seat kilometre, excluding foreign exchange, increased 14.6%. EBITDAR excluding forex declined 4.9% to ₹3,615 crore, and its margin contracted from 20.5% to 15.5%. Valuation and outlook: Since the company has reported losses, its trailing P/E ratio is currently not a meaningful valuation measure. The long-term growth drivers remain India's expanding aviation market, international route expansion, fleet growth and strong domestic market position. Overall, IndiGo remains a strong aviation business with significant market leadership, but its current earnings are under pressure. A sustained recovery in EBITDAR margins, passenger volumes and profitability will be important before the stock's valuation can be assessed confidently.