. INTERGLOBE AVIATION: Strong yields, but sustainability is a concern (INDIGO IN, Mkt Cap USD9.6b, CMP INR1975, TP INR2006, 2% Upside, Neutral) INDIGO reported an in line adjusted loss at INR10.6b, led by better than estimated yield (at INR5.2), with an in line RPK. A lower PLF (at 79.6%), due to modest demand, has kept RASK under check (up 19% QoQ) in 1QFY23. The management said its international flight operations in 1QFY23 stood at pre-COVID levels. It expects the same to grow in coming ...
Go Air (Go First) is looking to raise up to US$500m in its upcoming India IPO. The company is owned by the Wadia family, who also own Brittania and a few other businesses. Go Air is an ultra-low-cost carrier (ULCC) primarily operating in India. It had a market share of 10.8% in FY20 in the domestic market. As of Jan 2020, it covered a network of 28 domestic and nine international destinations. As of Feb 21, it had a fleet of 56 aircrafts, consisting of 46 A320 NEO models and 10 A320 CEO models....
INTERGLOBE AVIATION (IN), a company active in the Airlines industry, loses a star(s) at the fundamental level and sees its general evaluation downgraded. The independent financial analyst theScreener just removed a fundamental star(s) for a 3 over 4-star rating. As such, market behaviour remains unchanged and is evaluated as moderately risky. theScreener believes that the loss of a star(s) merits downgrade to the general evaluation of the title, which passes to Neutral. As of the analysis date J...
Two Directors at InterGlobe Aviation Ltd sold 12,992 shares at between 1,809.349INR and 1,884.580INR. The significance rating of the trade was 60/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's direc...
Full Article at IIR has reaffirmed its Recommended rating for PIA after undertaking a review post the appointment of a new Portfolio Manager, Harding Loevner. The full report can be found on the IIR website. On 26 July 2021, Pengana International Equities Limited (PIA) announced a fully franked dividend of 1.35 cents per share for the June quarter. This represents an 8% increase on the March quarter dividend and takes the total dividends declared for FY21 of 5.1 cents per share, fully franked....
Interglobe Aviation (Indigo)’s board approved a fund raising of around US$400m (INR30,000m) on 10th May 2021. This is the second time over the past year that the company has obtained a board approval for undertaking a fund raising. The previous instance was in Aug 2020, when the board approved a fundraising of up to INR40,000m. However, the quicker than expected recovery since then meant that the company never raised the funds and in Jan 2021, its CFO stated that it had no intention of doing s...
(INDIGO IN, Mkt Cap USD7.7b, CMP INR1423, TP INR1549, 9% Upside, Neutral) ** The Directorate General of Civil Aviation (DGCA) has extended the deadline for INDIGO to replace its A320neo aircraft fitted with unmodified Pratt and Whitney (PW) engines to 31st May'20 from 31st Jan'20 earlier. However, INDIGO will have to replace at least one engine of an aircraft with a modified PW engine by 31st Mar'20. ** According to the plan submitted by the company to the regulator, INDIGO will replace ~135 u...
INTERGLOBE AVIATION: Flight grounding to delay growth take offINTERGLOBE AVIATION: Flight grounding to delay growth take off(INDIGO IN, Mkt Cap USD7.6b, CMP INR1413, TP INR1535, 9% Upside, Neutral)** The Directorate General of Civil Aviation (DGCA) has directed INDIGO to ground all its A320neo aircraft fitted with unmodified Pratt and Whitney (PW) engines in case it fails to replace them with modified engines by 31st Jan’20. ** The DGCA has made it clear to preferentially replace unmodified engi...
ANNUAL REPORT THREADBARE (ART) | INTERGLOBE AVIATION FY19: Incentives/supplementary rentals support cash flows in operationally weak year INDIGO’s FY19 annual report analysis highlighted a first-ever operational loss since IPO. Although revenue increased by a robust 24% to INR285.0b, EBITDA turned negative to INR2.1b (FY18: INR29.6b) due to a rise of (a) 49% in fuel cost to INR119.4b, (b) 39% in aircraft rental to INR49.9b and (c) 87.3% in aircraft maintenance cost (net of compensation) to I...
INTERGLOBE AVIATION: Improved load factor/RASK; yield in-line (INDIGO IN, Mkt Cap USD8.2b, CMP INR1463, TP INR1410, 4% Downside, Neutral) INDIGO reported Ind-AS 116-based quarterly results. Yield for the quarter was in line with our estimate at INR4.55, leading to 45% YOY increase in net sales at INR94.2b (our estimate: INR88.6b). EBITDAR was at INR31.7b (+207% YoY) due to the transaction impact of Ind-AS 116 – lease and supplementary expenses were replaced by depreciation (on ROU asset rec...
InterGlobe Aviation: EBITDAR in line led by in-line yield and ASK (INDIGO IN, Mkt Cap USD9.2b, CMP INR1663, TP INR1460, 12% Downside, Neutral) Revenue of INR78.9b (+36% YoY, flat QoQ) was in line with our estimate, led by in-line yield, RPK and ASK. EBITDAR was at INR20.1b (+83% YoY, +29% QoQ) versus our estimate of INR20b owing to higher ticket revenue (+40% YoY/flat QoQ at INR70.3b), implying INR3.7/RPK (v/s INR3.31 in 4QFY18 and INR3.83 in 3QFY19). PAT came in at INR5.9b (4x YoY, 2x QoQ;...
Q3FY19 result highlights IndiGo’s Q3FY19 earnings were sharply ahead of our estimates due to beat on RASK. PAT came in at Rs1.9bn (down 75%yoy) vis-à-vis our estimate of net loss of Rs3bn. RASK came in at Rs3.7 (down 3%yoy) vs. our estimate of Rs3.3. Improvement in RASK was on account of improvement in fares in the 0-15 day period of the travel cycle. Passenger yield grew 3.7%yoy to Rs3.83 and average fare grew 6.6%yoy to Rs4206/pax (est). Employee costs grew 36.0% yoy to Rs8.3bn (our est...
InterGlobe Aviation: Back in profits on better yield; Higher crude prices to weigh on profitability (INDIGO IN, Mkt Cap USD6b, CMP INR1108, TP INR1074, 3% Downside, Neutral) INDIGO posting 3QFY19 revenues at INR79.2b, beating our estimate (est. INR70.1b, +28% YoY/QoQ) on better-than-estimated yield. Forex gain in the quarter stood at INR1b against gain of INR800m in 3QFY18 and loss of INR3.4b in 2QFY19. EBITDAR stood at INR16.0b (est. INR9.6b, -18% YoY). Depreciation was higher due to incre...
Q2FY19 result highlights IndiGo’s Q2FY19 earnings were extremely weak as it reported steep net loss of Rs6.5bn as against our estimate of PAT loss of Rs3.5bn due to severe pressure on yields (RASK), Fx MTM loss and higher than expected employee costs. Moreover, PAT includes deferred tax credit of Rs3.3bn baring which pre-tax loss stands at Rs9.9bn. RASK declined 8.1%yoy to Rs3.2, below estimate of Rs3.5, due to lower fares in the 0-15 day period of the travel cycle, which account for ~40% of...
Q1FY19 result highlights IndiGo’s Q1FY19 earnings were weak and were sharply below estimate due to lower yields, higher fuel and maintenance costs and adverse impact of INR depreciation. PAT declined 96.6%yoy to Rs278m as against our estimate of Rs4.7bn and consensus estimate of Rs5.1bn. RASK declined 3.1%yoy to Rs3.7, below estimate of Rs3.8, due to lower fares in the 0-15 day period of the travel cycle, which account for ~40% of IndiGo’s total bookings (pre-dominantly corporate/business ...
InterGlobe Aviation: Hit by a double whammy of crude and competition; Turbulence ahead! (INDIGO IN,Mkt Cap USD5.6b, CMP INR1004, TP INR903, 10% Downside, Neutral) INDIGO’s revenue of INR65b (+13% YoY, +12% QoQ) was below our estimate of INR72b due to a lower yield of INR4.10 (est. of INR4.51; -5% YoY, +7% QoQ). EBITDAR of INR10.3b (-47% YoY, -8% QoQ) came in significantly below our estimate of INR21.4b due to (a) higher fuel cost per ASK of INR1.54 (est. of INR1.48; +30% YoY, +11% QoQ) and...
Q4FY18 result highlights IndiGo’s Q4FY18 earnings were weak and were sharply below estimate due to lower yields. PAT declined 73.3%yoy to Rs1.2bn as against our estimate of Rs4.9bn and consensus estimate of Rs4.8bn. RASK declined 3.2%yoy to Rs3.4 (down 11.4%qoq), below estimate of Rs3.7. While Q4FY18 was a seasonally weak quarter, the extent of qoq decline has clearly surprised us. The yield pressure was largely driven by lower fares in the 0-15 day period of the travel cycle. Passenger yi...
InterGlobe Aviation: Aggressive capacity addition in a lean quarter weighs on profitability (indigo IN, Mkt Cap USD7.5b, CMP INR1355, TP INR1318, 3% Downside, Neutral) INDIGO’s revenue increased 20% YoY (-6% QoQ) to INR58b (our estimate: INR60b). EBITDAR of INR11.2b (-16% YoY, -42% QoQ) came in significantly below our estimate of INR14.8b due to a lower yield of INR3.82 (est. of INR4.08; -4% YoY, -11% QoQ) and higher fuel cost of INR1.39 (est. of INR1.36; +10% YoY, +10% QoQ). Passenger tick...
Q3FY18 result highlights IndiGo’s Q3FY18 earnings were strong and sharply ahead of our estimate largely led by higher yields and compensation received from Pratt & Witney (P&W) in relation to the grounding of A320 Neos. PAT grew 56.4%yoy to Rs7.6bn (est: Rs6.4bn). With capacity additions lagging demand, load factors continue to remain high and grew 120bp yoy to 88.5%. Passenger traffic grew 14.1%yoy to 13.5m, ASKM grew 13%yoy to 16.3bn and RPKM grew 14.6%yoy to 14.4bn. Average fare grew 6.8%...
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