IndiGo’s Parent Beats Estimates In April-June Quarter

InterGlobe Aviation Ltd. reported an over 37 percent rise in net profit even as the operating expenses increased in the quarter ended June.

Net profit grew 37.07 percent year-on-year to Rs 811 crore in the April-June quarter, IndiGo’s parent company said in its exchange filing. The bottomline surpassed the Bloomberg consensus estimate of Rs 730 crore. The company’s total costs rose more than 20 percent during this period while fuel costs alone rose nearly 29 percent.

Revenue rose nearly 26 percent to Rs 5,753 core compared to the same quarter last year.

Earnings before interest, tax, depreciation, amortisation and rental cost increased year-on-year by 27.67 percent to Rs 1,951 crore while the margin expanded marginally to 33.91 percent from the 33.37 percent in the previous year.

Yields, which measure the average earnings of the airline, rose 2 percent to 3.83 per kilometre.

Reducing Promoter Holding

InterGlobe Aviation has formed a committee to decide on the mode to reduce promoter holding to 75 percent from current 85.9 percent, it said in its exchange filing. The company recently picked banks including Citigroup Inc., JPMorgan Chase & Co. and Morgan Stanley to work on an institutional share sale, Bloomberg said in a report on July 20, citing people with knowledge of the matter.

The operator of IndiGo is planning the deal to help cut its owners’ stake to achieve the minimum public shareholding of 25 percent, the people said, asking not to be identified because the information is private.

Earlier this month, the low-cost carrier, IndiGo's parent company had shown unsolicited interest in buying stake in debt-laden national carrier, Air India.

Brokerages HDFC Securities, IIFL and Axis Capital have a ‘Buy’ rating on the stock. The stock has outperformed the S&P BSE Sensex on a year-to-date basis, having gained 57 percent compared to a 23.3 percent rise in the benchmark index.