InterGlobe Aviation Ltd. RISE 2% AFTER Q2 RESULTS

Shares of InterGlobe Aviation, the parent company of IndiGo, gained nearly 2% in early trading on Friday after the airline announced its fiscal second-quarter results. Leading brokerages, including Jefferies, Nomura and HSBC, maintained their 'Buy' ratings on the stock, citing strong pricing power and improving revenue yields despite concerns over rising fuel expenses and operating costs. IndiGo shares were trading up 1.7% during early deals. At this level, Nomura's revised target price of ₹6,200 indicates an upside potential of approximately 30%. Jefferies noted that management's commentary had helped ease concerns regarding passenger yields and non-fuel operating costs. However, the brokerage cautioned that the airline's earnings remained highly sensitive to fluctuations in fuel prices. It subsequently reduced its FY27 earnings-per-share (EPS) estimate by 9% and lowered its FY28–FY29 estimates by 2%. On Thursday, IndiGo reported a consolidated net loss of ₹1,879 crore for the September quarter, marking a 27% improvement from the ₹2,582 crore loss recorded in the corresponding quarter last year. Revenue from operations increased 26% year-on-year. The airline's passenger yields surged 34.3% year-on-year, helping offset some of the impact of higher aviation fuel costs. However, fuel expenses per available seat kilometre increased sharply by 68.9%, while passenger traffic declined 4.7%.