IndiGo Maintaining Market Share Even With Lower PLF; Aircraft Grounding Is A Transient Issue: ICICI Securities

IndiGo maintains more than 63% market share.

<div class="paragraphs"><p>IndiGo plane on tarmac. (Photo: Vijay Sartape BQ Prime).</p></div>
IndiGo plane on tarmac. (Photo: Vijay Sartape BQ Prime).

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ICICI Securities Report

Higher aviation turbine fuel prices and lower passenger load factors points toward the likelihood of an overall weaker spread in Q2 FY24. However, Interglobe Aviation Ltd. being able to maintain higher passenger market share despite lower PLFs indicates better operational aircraft availability than peers.

The headlines have also been dominated by the possible increase in aircraft on ground based on the outlook shared by Pratt and Whitney. IndiGo may mitigate the impact through secondary leases, as per media articles.

Additionally, original equipment manufacturer compensation might take care of incremental cost burden of secondary leases. As such, we remain positive on IndiGo basis structurally favorable supply demand equation in India and the vantage position of IndiGo.

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ICICI Securities Aviation Sector Update.pdf
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