Thursday, November 01, 2018

IndiGo had a busy second quarter, and its peers are not amused

IndiGo may have reported its first ever quarterly loss in the three months ended September, but the country's largest airline also had one of the busiest three months. A quarter that would have hurt its competitors.
Apart from adding 20 aircraft — the most in a quarter, the airline also added five new destinations and 35 more routes to its already formidable network.
"We have also selectively increased frequencies across our existing network and now offer connectivity to over 1,300 city pairs via nonstop and one stop flights," co-founder Rahul Bhatia said in a conference call after the company announced second quarter results.
The feverish pace of adding capacity and network may have hurt IndiGo's bottomline,  but its competitors will be taking a bigger hit. While SpiceJet and Jet Airways are yet to announce results, analysts expect both airlines to report deeper losses than they incurred in the first quarter.
The additional capacity has put pressure on prices, squeezing margins. This added to the already unfavourable circumstances in the industry, underlined by high fuel costs and intense competition.
31/10/18 Prince Mathews Thomas/Moneycontrol