InterGlobe Aviation Reports ₹986.7 Crore Loss in Q2 FY25, Shares Plunge 13% Amid Operational Challenges

InterGlobe Aviation Ltd., the parent company of IndiGo, reported a net loss of ₹986.7 crore for the September 2024 quarter, a stark contrast to a profit of ₹188.9 crore in the same quarter last year. This marks the company’s first quarterly loss in two years, leading to a 13% decline in its share price during Monday’s trading session.

Financial Highlights

  • Net Loss: ₹986.7 crore for Q2 FY25, compared to a profit of ₹188.9 crore in Q2 FY24 and ₹2,728.8 crore in Q1 FY25.
  • Operating Revenue: Increased 14% YoY to ₹16,970 crore, up from ₹14,943.9 crore in Q2 FY24.
  • EBITDA: Decreased slightly to ₹2,434 crore, with margins shrinking by 210 basis points to 14.3%.
  • Ancillary Income: Grew 21% YoY to ₹1,875 crore.
  • Passenger Ticket Revenues: Increased by 10% to ₹14,359 crore.

Reasons for the Loss

The company cited several factors contributing to the net loss, including:

  • Record Number of Groundings: Operational disruptions significantly impacted performance.
  • Higher Fuel Costs: Increased expenses due to fuel prices, although these costs have started to decrease recently.

Share Price Performance

  • 52-Week Range: The stock reached a high of ₹5,033.20 on September 12, 2024, and a low of ₹2,415 on November 1 of the previous year.
  • Annual Performance: Despite the recent downturn, InterGlobe Aviation’s share price has risen approximately 80% over the past year.
  • Recent Trends: The stock is down 16% in October after a 1% drop in September, ending a strong performance that saw growth from February to August 2024.

Outlook for Investors

The disappointing quarterly results have sparked concerns among investors regarding the airline’s operational challenges and rising costs. The market’s response reflects heightened anxiety following the negative report. Investors should closely monitor how IndiGo addresses its fleet management and fuel expenses in the coming months, as well as the broader market dynamics affecting the aviation sector.

Conclusion

As IndiGo works through this challenging phase, attention will be on its operational improvements and strategies for cost control. Investors are advised to keep an eye on the company’s recovery efforts and market conditions that could impact its future performance.

Disclaimer: This document is for informational purposes only and should not be considered financial advice. The content reflects the author’s opinion and analysis based on publicly available information. Investors should conduct their own research and consult with a financial advisor before making investment decisions.


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