IndiGo profit plunges 75 per cent in Q3 to Rs 191 crore
The net profit of InterGlobe Aviation, parent of low-cost airline IndiGo, crashed 75% year-on-year to `191 crore for the third quarter due to sharply higher jet fuel prices, lease rentals and other costs.
Although revenue from operations jumped 28.1% y-o-y to `7,916 crores, the operating margin or the EBITDAR (earnings before interest, tax, depreciation, amortization, and rentals) was down 11.2 bps y-o-y to 20.1%.
In the last three months, the IndiGo stock gained 38% and closed the Wednesday’s session at `1,107.95 apiece, down by 0.89%, on the BSE.
The airline’s revenue received a boost from better volumes — it carried 22.5% more domestic passengers in the December 2018 quarter — and better yields. The per passenger revenue stood at `3.83/km in Q3FY19, up 3.7% y-o-y. According to analysts, the average fare during the quarter was up 6.3% y-o-y.
IndiGo’s fuel cost jumped 69.2% y-o-y to `3,410.4 crores in the quarter under review. Other expenses surged 32% from the year-ago to `2,140.9 crores. Expenses on account of lease rentals were up 45.7% to `1,376 crores.
According to Indian Oil Corporation, the average aviation turbine fuel (ATF) price was `72,900/kl during the October-December period, compared with `54,900/kl a year ago, up 33%. The value of rupee depreciated around 9% y-o-y. Costs such as lease rentals, repairs, and maintenance are dollar-denominated in the airlines business.
With an enviable market share of 43% at the end of December 2018, the budget carrier has been adding capacity at a fast clip. The available seat kilometers (ASKs) are 21.6 billion, up 32.9% y-o-y. It inducted 19 aircraft during Q3FY19, taking the size of its fleet past 200.
The domestic market capacity excluding IndiGo has increased by around 10% y-o-y so far. IndiGo posted its first-ever loss of `652 crores, post listing, in the second quarter. IndiGo’s Q1FY19 profit had plunged 97% y-o-y to `28 crore.
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