Share price of IndiGo operator InterGlobe Aviation slipped over 4 per cent in intraday trade on the Bombay Stock Exchange (BSE) on Tuesday after aviation regulator Directorate General of Civil Aviation (DGCA) asked the airline to replace faulty engines.
Reacting to the news, IndiGo share price declined as much as 4.23 per cent to touch a low of Rs 1389, after opening lower at Rs 1421.45, against the previous close level of Rs 1450.45. In contrast, the S&P BSE Sensex was up 0.06 per cent at 40,914.
In a similar fashion, shares of InterGlobe Aviation were trading 2.85 per cent lower at Rs 1,408.75 per share on the National Stock Exchange (NSE). Early today, the stock opened lower and touched an intraday low of Rs 1,388.50 against Monday's closing price of Rs 1,450.15.
The DGCA on Monday directed IndiGo to ground an old A320neo family aircraft with an unmodified Pratt and Whitney (PW) engine each time it inducts a new A320neo plane into its fleet. The aviation regulator said that the IndiGo's efforts to modify the Pratt & Whitney engines in Airbus A320Neo aircraft were not satisfactory.
The DGCA also warned that a large portion of IndiGo's fleet could be grounded if the airline fails to meet the January 31, 2020 deadline to replace the engines.
The regulator issued these directives after the airline reported nearly 13 incidents of in-flight shutdowns over the last one year. On November 1, the DGCA had asked IndiGo to replace PW engines under both wings of 97 A320neo family aircraft "at all costs" by January 31 or they would be grounded.
Commenting on the development, IndiGo has said that the airline is working with PW and Airbus to adjust inflow of LPT (low-pressure turbine) third stage modified engines to meet the regulatory norms.
As of September 2019, the airline had around 247 planes, including 89 A320 neos, 129 A320 ceos, 6 A321 neos, and 21 ATRs, and a share of around 47 per cent of the domestic air passenger market.
Edited by Chitranjan Kumar