InterGlobe Aviation, the company behind IndiGo, has reported a significant financial turnaround this year, with its shares rising by 3% following the announcement. The airline reported a net profit of ₹188 crore this year, a stark contrast to last year's loss of ₹1,583 crore.
The company's consolidated revenue also saw an impressive increase of nearly 20% YoY to ₹14,944 crore. This growth was maintained despite seasonal weakness experienced in Q2. A key contributor to this positive performance was the surge in EBITDAR from ₹229 crore to ₹2,446 crore (INR100 crore = approx. USD12 million). The boost came as a result of one-off reversals of provisions, compensations, and receipt of compensation benefits from Original Equipment Manufacturers (OEMs).
However, it wasn't all smooth sailing for the company. It faced higher costs including wet lease expenses which resulted in an FX adjusted EBITDAR margin of 20.2%.
In terms of strategy, InterGlobe Aviation is focusing on enhancing IndiGo's global brand awareness. The company foresees more international market growth through capacity deployment and network expansion, all backed by a robust balance sheet.
Several financial institutions have retained their ratings for the company. BofA Securities and Prabhudas Lilladher have both kept their 'Buy' rating with target prices of ₹2700 and ₹2,816, respectively. Motilal Oswal has maintained its 'Neutral' rating with a target price of ₹2,800.
It's worth noting that the aviation market is seeing some changes as well with the resurgence of Air India and the entry of new player Akasa Air. These developments could introduce new dynamics into the competition landscape for InterGlobe Aviation in the near future.
InvestingPro Insights
Drawing from real-time data and InvestingPro Tips, some key insights can be identified for InterGlobe Aviation.
Firstly, one of the notable InvestingPro Tips for InterGlobe Aviation (INGL) emphasizes the company's consistent increase in earnings per share. This aligns with the company's reported financial turnaround and the significant rise in net profit this year.
Secondly, InvestingPro data indicates that the company's net income is expected to grow this year, providing further evidence of its strong financial standing.
Lastly, despite the recent revenue growth, InvestingPro Tips highlight that the growth pace has been slowing down. This could be a factor to keep an eye on in the future.
For more detailed analysis and additional insights, InvestingPro offers 8 more tips related to InterGlobe Aviation. These cover areas such as valuation, debt levels, and the company's standing in the Passenger Airlines industry. This comprehensive set of tips can be a valuable resource for investors looking to gain a deeper understanding of the company's financial health and future prospects.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.