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Informist, Thursday, Jul. 23, 2026

 

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--InterGlobe Aviation: Passenger demand held up despite volatile environment 
--CONTEXT: Comments by InterGlobe Aviation in post-earnings analyst call 
--InterGlobe Aviation: Jet fuel remained largest source of pressure Q1 
--InterGlobe Aviation: Unit passenger revenue for Q2 seen up over 25% YoY 
--InterGlobe Aviation:Capacity in Q2 will be tapered down for off-season mkt 
--InterGlobe Aviation: Will have to keep testing higher yields as costs rise 
--InterGlobe Aviation: All approvals in place for Walsh to join co as CEO 
--InterGlobe Aviation: Will focus on volume-driven growth after the war ends 

 

By Anand JC and Prateem Rohanekar

 

MUMBAI – InterGlobe Aviation Ltd., which operates budget carrier IndiGo, wants to pivot towards volume-driven growth from pricing-driven growth currently once the war in West Asia ends, the management told analysts in a post-earnings conference call Thursday. The war has pushed up prices of key expenses such as jet fuel, which has prompted the company to opt for pricing-driven growth in recent quarters.

 

The company's yield levels had increased as much as 40?fore and after the COVID-19 pandemic as airline travel saw a marked increase after the national lockdown was lifted. Since then, the company had seen volume-driven growth.  

 

"We are (again) experiencing a similar kind of shift where we are in a crisis in terms of the fuel (price) being elevated (and) the currency depreciation. These have elevated the cost levels," a top company official said. "We are testing new levels of pricing. As things moderate, we will look towards again bringing more volume." Others costs excluding fuel have also gone up because of inflation.

 

The depreciation of the rupee against the dollar also gives the aviation company the leeway to push prices to offset normal cost increases. "Even after the crisis is over and the fuel moderates, we are hopeful that we will be able to then start driving volume-driven growth where we are able to push more volumes so that more consumers can avail the services," the company said.

 

InterGlobe Aviation disclosed its earnings for the June quarter minutes after the market closed for the day. It reported a net loss of INR 3.82 billion on revenues of INR 245.84 billion. The company blamed its loss on rising aviation turbine fuel price, the sharp depreciation of the rupee against the dollar, and the war in West Asia.

 

"On the cost side, fuel remained the largest source of pressure during the quarter. Global fuel markets continued to be influenced by developments in the Middle East (West Asia), resulting in significant volatility," the company said. InterGlobe Aviation focused on cost efficiency measures, prioritising the use of more fuel-efficient aircraft over older ones wherever commercially appropriate to reduce the impact of the negative factors on its margin. Additionally, the company curbed discretionary spending and deferred increments for senior-level employees.

 

"As we enter the seasonally softer demand period and continue to manage fuel and airspace volatility, we are adopting a prudent and measured approach to capacity," the management said. The September quarter is a seasonally weak period for airlines because discretionary leisure travel drops sharply after the end of the summer holiday season and schools reopen globally.

 

"We are rationalising capacity by selective route-level actions and a few temporary international suspensions," the management said. InterGlobe Aviation expects unit passenger revenue for the current quarter to grow over 25% on year. "We are expecting the loads (load factors) to be flattish or slightly down (in Q2), similar to what it was in Q1, but that's largely driven by the fact that a large part of the capacity has also been reduced, which is typical of this quarter," the company said.

 

During the June quarter, the company handled 31.3 million passengers, up 1% on year. "Despite a volatile environment, passenger demand held up," the management said. In the current quarter, IndiGo has tapered down its capacity in off-season markets. "We intend to bring more capacity back into the market because the demand is more likely than not to be very high, given that it's going to be a peak Q3 again," an official said.

 

Earlier this year, InterGlobe Aviation announced that Willie Walsh, director general of the International Air Transport Association and former chief of British Airways, would be appointed its chief executive officer in August. The company has now confirmed that Walsh will take over as chief executive of InterGlobe Aviation from August following the completion of all regulatory approvals.

 

Thursday, shares of InterGlobe Aviation closed 1.8% lower at INR 5,023.50 on the National Stock Exchange.  End

 

Edited by Rajeev Pai

 

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