IndiGo shares drop as DGCA orders 10% cut in winter schedule 2025; target prices

Shares of InterGlobe Aviation Ltd (IndiGo) resumed downward trend, falling over 1 per cent in Wednesday trade after Directorate General of Civil Aviation (DGCA) asked the low-cost carrier to cut domestic winter schedule 2025, across all sectors, by 10 per cent. This is against a 5 per cent cut direction on December 8. The fall was seen even as IndiGo in another update said it has reinstated its operations across network after days of improvement across the network. 

On Wednesday, the IndiGo stock hit a low of Rs 4,853 apiece but recovered to trade at Rs 4,929 level by 10.37 am, still down 0.69 per cent. The stock has fallen 16.71 per cent in the past two weeks. 

IndiGo said all flights published on its website are scheduled to operate with an adjusted network. Also, nearly all bags that were stuck at airports have been delivered to customers and the teams are working on delivering
the remaining at the earliest, it said.

HSBC in a note said investors have been asking if the government can cap Indigo's share at 50 per cent or less. 

"We don't think this would be easy, especially because pverall industry capacity is very tight. Air India is not growing next year, while SpiceJet and Akasa could add only a few planes. IndiGo is the only airline taking delivery of around 50 aircraft every year. In this scenario, any capping to limit Indigo's share seems unlikely," it said.

The brokerage said IndiGo could cancel around 11,000 flights in total, causing revenue losses in the range of Rs 1,200-1,400 crore and a net profit loss of around Rs 300-500 crore. 

"Overall, we have lowered our FY26 and FY27 Ebitda forecasts by 4 per cent and 5 per cent, respectively. We cut our target to Rs 5,977 from Rs 6,920, but maintain our Buy rating since we don't see any structural damage to IndiGo," HSBC said.

A penalty could be a near-term action by the GoI; Indigo may also be directed to further compensate the affected parties, Emkay Global said. The government may want to bring in more players, though the global aviation supply-chain scenario remains challenging, it said.

On Tuesday,  Pieter Albers, the CEO of IndiGo said "Now that the immediate crisis is dealt with, we started to focus internally on what has led to this, lessons learned to be drawn, and how to emerge stronger from this. While there's still customer angst, I would like to also share that we're getting heartwarming messages from our customers, and the people are back to booking on our flight, which is giving us a big encouragement."

IndiGo later informed stock exchanges that it was operating more than 1800 flights, connecting all 138 stations in our network, and had plans to fly nearly 1900 flights on Wednesday. 

"We have optimised our operations, and our on-time performance is also back to normal levels. We have also automated the procedure for our customers to get full refunds upon cancellations through a simple process on our website," it said post Tuesday's trading session.