Emkay Global
Target: ₹5,200
CMP: ₹4,537.60
InterGlobe Aviation (Indigo)’s management announced aggressive targets for FY30 at its CY26 Analyst Day – about 300 billion capacity (ASK), >550 aircraft fleet, about 200 million passengers, and about 3,000 daily flights, with a mid-teens FY28-30E ASK CAGR. Narrow bodies are expected to be Indigo’s core, but new configurations will be introduced.
However, the FY27 outlook is volatile and the management has guided for a broad single-digit growth in ASK year on year amid capacity rationalization (variable cost is not met), with passenger range-bound (about 125 million).
Pricing, however, would drive earnings growth, as seen in other consumption industries. Normalization of the West Asia sector is crucial for driving the international segment, and status of the conflict is a primary near-term determinant.
Indigo is also optimistic about the launch of XLRs (delivered two of the nine annual targets), and upgrade of features with regard to meals and seats for making long-haul flights and Stretch more attractive.
The government of India’s fuel pricing support is a positive, but more reforms are required for the industry to sustain during adverse cycles.
Indigo is evaluating fuel hedging for international flights (as do competitors in Europe and Asia). We lower FY27E ARPU growth from 8 per cent to 6 per cent, but increase the yield accordingly, thus retaining our earnings estimate and TP of ₹5,200; BUY.
Published on June 9, 2026