InterGlobe Aviation, the operator of no-frills airline IndiGo, on August 2, 2023, announced its quarterly results, and it turned in a profit of INR 3,090.6 crore for the April-June 2023 period (Q1FY24), as compared to a net loss of INR 1,064 crore in the same period a year ago.
IndiGo makes a large profit on the back of reduced competition.
IndiGo, which commands 63.2% of domestic market share, posted revenues that rose 29.8% from the year ago. For Q1FY24, the revenue was INR 16,683.1 Crores, compared to INR 12,885 Crores a year ago. The first quarter is a traditionally strong quarter, and IndiGo, in a conference call, said that the fact that some festivals moved from Q2 to Q1 also contributed.
For the quarter, passenger ticket revenues were INR 14995.6 Crores, an increase of 30.8%, and ancillary revenues were INR 1548.4 crores, an increase of 20.4% compared to the same period last year.
IndiGo did not directly attribute anything to the lesser competition (Go First is not operating at the moment). Still, with higher revenues and last-minute tickets, the yields, of course, trended higher for the airline. The results surpassed analyst expectations.
CEO Pieter Elbers, on this occasion, said,
We produced strong operational performance and welcomed the highest number of quarterly passengers, which enabled us to generate the highest-ever quarterly revenue and net profit for the quarter ended June 2023.
He added that in the first quarter of 2023-24, IndiGo placed a new order for 500 aircraft that, takes the outstanding order book to about 1000 aircraft.
The load factor for the no-frill airline stood at 88.6 per cent at the end of the June quarter as against 79.6 per cent in the same quarter a year ago.
The airline has seen growth of about 10% in its international traffic quarter on quarter, with 26.85 lakh passengers using IndiGo to travel abroad. This comes on the back of the utilisation of wide bodies to sell fares to travel outside of India, and as per IndiGo, all these learnings will be taken in by the airline when they get set to launch flights with the XLR whenever it happens.
IndiGo has made a massive profit of INR 3090 Crores, the highest profit in its history, attributed to Q1FY24. The airline has various things working for it, including the reduction in competition, a high market share (almost two third of the Indian market) and a systematic pipeline for expansion. Not just that, but an enhanced focus on international travel as well.
What do you make of IndiGo’s growth over the past years? The airline turns 17 shortly.
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