HSBC said IndiGo’s competitive position is improving as rival Air India faces operational challenges, while elevated airfares and softer crude oil prices could provide further momentum to earnings.
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According to the brokerage, fares are likely to remain firm amid tight industry capacity, while fuel surcharges may not be fully rolled back, supporting revenue growth.It also highlighted the sensitivity of airline earnings to changes in yields and fuel costs. The brokerage estimates that a 2% change in yield growth could impact IndiGo’s FY27 estimated EBITDA by around 8% and earnings per share (EPS) by nearly 49%.
Similarly, a 5% change in fuel prices could alter FY27 estimated EBITDA by about 10% and EPS by roughly 60%, underscoring the importance of crude oil movements to the airline’s profitability.
According to Bloomberg data, 21 of the 26 analysts covering InterGlobe Aviation have a ‘buy’ recommendation, while three suggest ‘hold’ and two recommend ‘sell’. The average analyst target price stands at ₹5,323.67.
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Shares of Interglobe Aviation are trading 4.2% higher on Wednesday at ₹5,169. The stock is up 15% so far over the last one month and has recovered all the losses it made during the Iran war.
