Tag: IndiGo

Why this global investment firm ranks M&M and Indigo among its top picks

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Matt Orton, Chief Market Strategist at Raymond James Investment lists Mahindra and Mahindra (M&M) and Interglobe Aviation (IndiGo) among his top picks given their significant presence in the expanding Indian market.

In an interview with CNBC-TV18, he pointed out that the automotive sector has played a significant role in driving the Indian market, serving as a pillar of strength.

“Mahindra and Mahindra is a top pick of mine because you have seen margin hold up even as the order books are kind of been going through a little bit of a reworking phase earlier this year. But it has exposure not only to light motor vehicles, and light SUVs but also to the farm side, which is going through a period of recovery. So, I think when we come out the other side, you are going to see an earnings acceleration there,” he said.

Also Read | M&M ED and CEO shares EV plans, says ready to compete with anyone amid Tesla entry news

Indigo, he believes, will benefit from the ever increasing number of travellers both within India and globally.

He highlighted the company’s strong margins and profitability, attributing it to the favourable balance between seat costs and customer demand.

Investments in widebody jets will also help Indigo expand its global reach beyond the current fleet’s capabilities, he noted.

Also Read | IndiGo only airline in the world to induct one plane every week: CEO Pieter Elbers

Overall, he thinks investors should now be selective in what they own.

“There are a number of areas of the market that have won pretty significantly. So, you want to lean into quality, you want to lean into where there is margin strength, and where you are seeing a little bit of an acceleration in earnings,” he said.

He also noted the appeal of various cyclical segments in both the US and global markets. “I have been advising to use weakness as an opportunity to put some cash to work.”

For the entire interview, watch the accompanying video

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

IndiGo announces special bonus to employees ahead of Q4 results

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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India’s largest airline, IndiGo, has announced a special one-time bonus for employees across the board ahead of its Q4 results. The bonus will be one and a half months’ basic salary and will be disbursed along with the May salaries. This special bonus will be additional to the annual bonus and increment that employees will receive later this year.

“In addition to this regular process, on behalf of our CEO and the entire IndiGo Leadership team, we would like to express our appreciation for your collective effort by saying, ‘Thank you for all your great work and for bringing the company back.’ We are pleased to announce a one-time special bonus to reward each colleague. This Thank You Bonus shall amount to 1.5 months’ Basic salary (One and a half months’ Basic Salary). This amount will be disbursed along with the May 2024 salary as an Ex-Gratia,” IndiGo told employees in an internal email.

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This announcement comes just days after the airline signed a deal to buy 30 wide-body Airbus A350 planes that will help it expand its international reach, as CEO Pieter Elbers stated, and will help it fly from ‘Patna to Paris.’

The special bonus also indicates that IndiGo is likely to hit another blockbuster quarter after recording ₹3,000 crore profit in the third quarter of FY24. The airline clocked revenue of ₹19,452 crore in Q3FY24, up 30% compared to Q3FY23. IndiGo’s margin also climbed to 26.5% in the third quarter of this fiscal year, a significant rise from 20.9% in the same quarter of the last fiscal year.

“When we published our Q3 results in February 2024, we moved our company back into a net worth positive position. This is an incredibly important milestone. From here, we can further build our future, and obviously, the recent momentous wide-body fleet announcement is a further testament to both our belief and commitment towards the future of IndiGo,” the email stated.

The airline has managed to maintain an operational fleet of over 300 planes despite having more than 60 planes grounded due to the Pratt & Whitney engine recall. IndiGo continues to hold over 60% market share.

Also read: IndiGo shares hit record high, analysts expect stock to fly up to 18% higher

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

IndiGo shares hit record high, analysts expect stock to fly up to 18% higher

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The shares of IndiGo’s parent company InterGlobe Aviation rose almost 3% to hit an all-time high of ₹4,100 in intraday trade on BSE on May 2. At least two brokerages have raised their target price on the stock following the firm’s decision to further expand its fleet.

London-headquartered brokerage HSBC, which has a buy call on the stock, has raised its target price on the aviation stock to ₹4,445. This implies it sees a potential upside of more than 11% from the closing price of April 30.

The brokerage believes IndiGo’s strategic decisions to order 30 A350-900s aircraft and the purchase of rights for an additional 70 Airbus A350 family planes seem sensible.

The commentary comes as earlier this week in an analyst call, IndiGo said, it expects to double its fleet from over 350 planes currently to 600 by 2030. CEO Pieter Elbers claimed that no other airline in the world is inducting one aircraft every week like IndiGo.

The airline has an orderbook of around 1,000 narrow-body planes including the 500 aircraft ordered in June 2023.

Though it is too early to predict the outcome, HSBC is of the view that most of the drivers are favourable with product quality and execution holding the key. It added that despite strong competition, it looks like the airline’s well-supported strategy is sound.

Mumbai-based financial services firm Emkay Global also reiterated its positive stance on the aviation company. It has not only upgraded its rating from add to buy, but it has also raised the target price by 34% to ₹4,700. The target price implies a potential upside of 18%.

Also Read: IndiGo will be able to fly directly from Patna to Paris, says CEO Pieter Elbers

“The stock, despite its recent strong run-up, still has legs, given that competitors Air India/Akasa’s order books have higher exposure to Boeing (737 Max, facing safety issues) which implies risk to their near-term capacity adds,” the brokerage noted.

It asserted that Indigo, which is backed by a steady stream of Airbus deliveries, can gain market share and improve yields and it expects new airports in Noida (NCR) / Navi Mumbai to boost passenger traffic in one or two years.

Though fuel prices are contained, a spike would hit rivals more than IndiGo, diminishing competition for it, Emkay Global added.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Indian airlines issue advisory for flights to and from Dubai, Sharjah and Abu Dhabi

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Indian airlines have issued an advisory for flights to and from Dubai, Sharjah and Abu Dhabi due to adverse weather conditions. IndiGo, SpiceJet and Vistara airlines have issued passenger advisory alert.

Heavy rains and thunderstorms lashed the UAE on Thursday, May 2, two weeks after Dubai was hit by unprecedented storms that paralysed the emirate for days. On May 1, the country’s National Emergency Crisis and Disaster Management Authority (NCEMA) elevated the readiness and preparedness levels of the national system to deal with the situation.

While these rains are expected to be less severe than the unprecedented downpour that hit the country last month, the public is urged to take precautions. On April 14-15, extreme rainfall battered regions of the Arabian Peninsula, with Dubai experiencing the heaviest rains on record since 1949.

“Due to adverse weather conditions in Dubai, Sharjah and Abu Dhabi, our flight operations are impacted. Please keep a track of your flight status before leaving for the airport,” IndiGo has put a post on X.

#6ETravelAdvisory: Due to adverse weather conditions in #Dubai #Sharjah & #AbuDhabi , our flight operations are impacted. Please keep a track of your flight status at https://t.co/TQCzzyjLr2 before leaving for the airport.

— IndiGo (@IndiGo6E) May 2, 2024

“Due to the anticipated bad weather conditions from May 2 to 5, traffic congestion is expected enroute to Dubai Airport. Customers are advised to allow more time for their journey to the airport. Thank you,” Vistara issued an advisory.

#TravelUpdate: Due to the anticipated bad weather conditions from May 2nd to May 5th, traffic congestion is expected enroute to Dubai Airport. Customers are advised to allow more time for their journey to the airport. Thank you.

— Vistara (@airvistara) May 1, 2024

SpiceJet also asked passengers to keep a check on their flight status. “Due to bad weather (thunderstorms with rain) in Dubai (DXB), all departures/arrivals and their consequential flights may get affected. Passengers are requested to keep a check on their flight status.”

#WeatherUpdate: Due to bad weather (thunderstorms with rain) in Dubai (DXB), all departures/arrivals and their consequential flights may get affected. Passengers are requested to keep a check on their flight status via https://t.co/VkU7yLjZly.

— SpiceJet (@flyspicejet) May 2, 2024

The UAE has issued an alert for heavy rains for two days.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

IndiGo only airline in the world to induct one plane every week: CEO Pieter Elbers

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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IndiGo, India’s largest airline by fleet size and market share is expecting its fleet to double from over 350 planes currently to 600 by 2030.

Speaking about the airline’s capacity expansion, CEO Pieter Elbers claimed that no other airline is the world is inducting one aircraft every week like IndiGo.

“What IndiGo is doing today, inducting a plane every week, is something I’m not aware of any airline in the world actually must be doing that. And having the crew ready, having the training ready, we have our own training center where we train 2,000 people a day and having the spares ready,” Pieter Elbers said adding that IndiGo is in a formidable position to deal with the challenges.

The airline has an outstanding orderbook of around 1,000 narrow-body planes including the 500 aircraft order placed in June 2023.

One of the reasons that has kept IndiGo much ahead of competition is its operational strategy having a single aircraft fleet and single configuration that makes it cost efficient as compared to other airlines.

Widebody planes & longer route flights might need two or three-class configuration offering customers the choice of business and first class as well.

That could change the airline’s long-practiced business strategy.

So, will it still be cost efficient?

IndiGo CEO says narrow-body planes will continue to remain the foundation of its business.

“Today we operate around 350 planes. By 2030, we will be operating in the range of 550 to 600 aircraft. That’s a single aircraft, I don’t think there’s many airlines in the world running an operation of that size as a single aircraft type. So that’s the very core and the very foundation of the network of IndiGo today…clearly A350 is not the same as A321. But it is very much building on that very same family. And clearly our relationship with Airbus today is already deep and well developed. And there’s obviously similarities in a lot of elements there. So I think we will continue to have synergies in areas around the cockpit crew, around methodologies,” Elbers said.

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IndiGo will be able to fly directly from Patna to Paris, says CEO Pieter Elbers

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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IndiGo CEO Pieter Elbers on Tuesday (April 30), said that the airline will be able to directly connect Patna to Paris and Delhi to Southern Europe with the wide-body A350 and narrow-body A321 XLR planes that will join its fleet in the coming years.

Replying to questions in the analyst call on the recent Airbus A350 order, Elbers stated that the order for 30 wide-body planes is sizable enough to make an impact in a new space and scale up later.

Talking about the Airbus narrow-body A321 XLR that is expected to start arriving in 2025, Elbers said, “The (A321) XLR will help us to make sure that we can further extend our range. We can reach from Delhi to the southern part of Europe, which cannot be reached today. So it helps us extend our range. But it also helps us to increase the number of routes.”

“These recent expansions that we have done, be it Mumbai to Nairobi or Bangalore to Bali, are all limited by today’s capabilities of the LR. The XLR will help us expand those openings to more cities in India,” Elbers added.

IndiGo‘s huge order of 500 Airbus narrow-body planes announced in June 2023 includes 69 A321-200NY (XLR)s.

Airbus claims the A321 XLR is an Xtra Long Range plane with a range of 4,700 nautical miles (nm), 180–220 seats and 30% less fuel. It opens new opportunities for non-stop, 11-hour flights linking primary and secondary cities all around the globe.

The narrow-body plane can enable airlines to connect distant destinations such as New York to Rome, London to Vancouver, Delhi to London and Sydney to Kuala Lumpur.

The direct connectivity to longer routes that Pieter Elbers is talking about is expected with the wide-body Airbus A350-900, which accommodates 300–350 passengers in a standard three-class configuration and flies non-stop from short-range segments to ultra-long-range routes of up to 9,700 nm (18,000km).

“Clearly, the A350 will have even more range and bring different opportunities, and part of the world will be able to connect directly to India. And a lot of that traffic today is connecting to other parts of the world and we feel that it could connect to India. I shared a few examples—Patna to Paris is a great way to connect India on IndiGo in the future to the rest of the world,” the IndiGo CEO said.

While IndiGo has not yet decided the exact configuration of the two planes and the routes it wants to fly them to, the IndiGo CEO clarified that since the A321XLR has a narrow body with a limited number of seats, it can fly to the “thinner” markets and the A350 can be used for the “larger” markets.

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IndiGo shares hit all-time high after placing order for 30 wide-body aircraft from Airbus

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of InterGlobe Aviation Ltd., the parent of the country’s largest airline IndiGo, gained up to 4% on Friday to hit a record high of ₹3,958.80. This was after IndiGo placed its first-ever order for wide-body aircraft as the company intensifies its efforts to take a bigger slice of the international travel business from dominant Gulf airlines.

The low-cost carrier placed an order for 30 A350-900 aircraft and expects the deliveries to begin in 2027. It also has purchase rights for an additional 70 Airbus A350 family planes, according to a Reuters report.

While Airbus no longer publishes prices, its latest deal with IndiGo’s would be worth more than $9 billion, the report said quoting the last catalogue rates published in 2018. The report also added that airplanes in such bulk deals are sold for less than half of the official price.

“The exact configuration of the aircraft will be decided at a later stage, and the deliveries are expected to start from 2027,” IndiGo said in an exchange filing. The airline also said that it has Purchase Rights for an additional 70 Airbus A350 Family aircraft, at its discretion, for possible future needs under certain conditions.

“Fleet of 30 Airbus A350-900 aircraft will allow IndiGo to embark on its next phase of becoming one of the leading global aviation players. This reaffirms IndiGo’s belief in, and commitment to, the growth of India, and in our strategic partnership with Airbus,” said Pieter Elbers, the chief executive officer of IndiGo.

IndiGo, which has a 60% share in the country’s domestic aviation market, is planning to double its total capacity by the end of the decade and expand its network in global markets.

The stock was trading 3.41% higher at ₹3,942.45 apiece on the NSE. IndiGo shares have risen 32% so far this year and are up 95% in a year.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

IndiGo orders 30 wide-body aircraft from Airbus

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

IndiGo’s Rahul Bhatia and former Tech Mahindra CEO CP Gurnani join hands for an AI venture

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Rahul Bhatia, the Group Managing Director of IndiGo’s parent firm InterGlobe Enterprises, has joined hands with former Tech Mahindra CEO CP Gurnani for an artificial intelligence (AI) venture.

The venture, unveiled on Tuesday, April 23, called ‘AIonOS’ will offer target service offerings on AI as a service, data engineering, and data harmonisation platform.

Rahul Bhatia said their vision was to integrate AI across various industries.

AlonOS, a statement said, will be spearheaded by AlonOS Executive Vice-Chairman Gurnani and is structured around four key business lines, each helmed by a dedicated leader

Gurnani, who is the chairman of Assago Group, highlighted that InterGlobe is the majority shareholder of this venture with the Assago Group. “For our business plan we have made sure we’re not only well funded but there’s a cushion as well,” Gurnani said, adding a lot of good announcements have been lined up for the next one year.

Elaborating, he said the company is headquartered in Singapore, with key officers already appointed in the city. AlonOS will have a global business presence, including in North America, India, the Middle East, Europe, and the Asia-Pacific. Some delivery and tech centres will be based out of NCR, Chennai, and Hyderabad, with two centres in NCR already operational.

“We want to be close to the customers. Over the next three months, we will periodically open offices in Europe and North America,” Gurnani said.

According to the release, AlonOS will automate and optimise decision-making, orchestrate workflows, drive efficiency, enhance customer experiences and identify opportunities to streamline processes, reduce costs and maximize productivity.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Delhi DCP shares his ‘harrowing’ experience over IndiGo flight delay

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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In a nightmare scenario, an Delhi-bound IndiGo flight allegedly was forced to land at the Chandigarh airport with “fuel left for just 1-2 minutes”. Delhi Deputy Commissioner Police (Crime) Satish Kumar, who was onboard, shared his experience  on social media platform X (formerly Twitter).

In his post, Kumar said the flight (6E 2702) was swas scheduled to take off at 3.25 pm and arrive in Delhi at 4.30 pm, but that the pilot told passengers around 4.15 pm that departure was delayed due to bad weather in Delhi.

Had a harrowing experience yesterday with @IndiGo6E Flight No. 6E2702 from Ayodhya to Delhi. Scheduled departure time 3:25 p.m. and schedule arrival time 4:30 p.m.
Around 4:15 p.m. the pilot announced that there’s bad weather at @DelhiAirport. and assured that the plane has 45…

— Satish Kumar (@CopSatish499) April 14, 2024

Kumar added that by then, several passengers and a member of the flight crew started vomiting out of panic. He tagged the Directorate General of Civil Aviation and the Ministry of Civil Aviation to look into whether all the standard operating procedures were followed.

“Finally the plane managed to land at 6:10 p.m. at Chandigarh Airport after a lapse of 115 minutes since the 45 minutes Holding fuel announcement. Got to know after landing that we’ve landed in the nick of time with only 1 or 2 minutes of fuel left from the crew staff. What an ordeal it was for the passengers … Kindly enquire if all SOPs were followed or was it the narrowest escape?” Kumar added in his post.

IndiGo issued a statement on the incident.

“IndiGo flight 6E 2702 operating between Ayodhya and Delhi on April 13th was diverted to Chandigarh due to bad weather in Delhi. The captain executed a go-around which is in line with the standard operating procedure. This is an absolutely safe maneuver (sic). The aircraft had sufficient fuel at all times to divert to an alternate airport, as per regulations. Safety of our esteemed passengers is of prime importance to us. We regret any inconvenience that may have been caused due to factors beyond the airline’s control,” the airline said in the statement.

Till now the post on X has become pretty much viral as it has over 2.03 lakh views and hundreds of reposts and several replies. Reacting to this, Suman Nalwa, who is the PRO of DCP Delhi Police quote-posted this.

Glad you landed safely. @DGCA should rework rules and procedures regarding fuel holding by flights. Safety of passengers is paramount. Adequate fuel should be available on flights operating in unfavourable weather conditions.#AirTravel #Aviation https://t.co/z1NAxORfnv

— Suman Nalwa (@sumannalwa) April 15, 2024

A veteran of the Aviation Industry Captain Shakti Lumba quote posted and said, ”Straight up your street @DGCAIndia after two missed approaches a diversion is mandatory: Still holding instead of diverting and then landing allegedly on fumes is a gross safety violation @IndiGo6E must investigate this flight and amount of fuel on arrival at Chandigarh: This Captain has no business being in Command if the report is correct.”

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow