HSBC expects IndiGo, operated by InterGlobe Aviation Ltd., to report a loss of Rs 4,100 crore in the ongoing fiscal because of low demand, rising costs and cash burn.
That prompted the research firm to cut IndiGo's 12-month price target to Rs 1,200, implying a downside of about 30% from Monday's close. It maintained the 'reduce' rating.
Of the 22 analysts tracking the stock, 11 have a ‘buy’ rating, three suggest a ‘hold’ and eight recommend a ‘sell’, according to Bloomberg data. The average of 12-month consensus price targets implies an upside of 0.8%.
The Indian aviation industry is facing its most challenging period as demand has disappeared and recovery with the ongoing second Covid-19 wave seeming highly uncertain, HSBC Global Research said in a note. Macro factors also continue to be unfavourable with the supply-demand equation highly skewed.
The Indian aviation industry is facing its most challenging period as demand has disappeared and recovery with the ongoing second Covid-19 wave seeming highly uncertain, HSBC Global Research said in a note. Macro factors also continue to be unfavourable with the supply-demand equation highly skewed.
"While the fleet growth seems low, the industry is taking delivery of large-sized narrow-body aircraft; that means the capacity growth could still be in low double digits," HSBC said. "On the other side, the jet fuel price has risen sharply, up almost 32% since the start of the year, while the rupee has depreciated against the dollar by 2% and is trading at 73.8. One-year forward rupee/dollar is t
18/05/21 Rishabh Bhatnagar Copyright © BloombergQuint
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