Smooth landing for IndiGo, SpiceJet in Q1FY20; yields seen muted in Q2FY20

India’s domestic air passenger traffic had slowed down in the June quarter as Jet Airways’ shutdown pulled the beleaguered airline’s capacity out of the system.

Even so, last quarter’s financial results of InterGlobe Aviation Ltd and SpiceJet Ltd are nothing to complain about. InterGlobe runs IndiGo, India’s largest airline by market share.

One factor that helped last quarter was that the environment for yields, a measure of pricing, remained stronger. IndiGo surpassed Street expectation by clocking a 12.7% year-on-year improvement in its yields. On the other hand, smaller rival, SpiceJet’s yield increased by 2%, falling short of estimates.

At the time of announcing results, SpiceJet said, “The airline’s operations remained stressed for a large portion of this quarter due to the continued grounding of its superior B737 MAX aircraft. This limited the airline’s ability to take its yields up, owing to passenger disruptions and re-accommodation; while simultaneously increasing its fixed costs on this category of aircraft.”

“While Indigo’s domestic passengers carried grew by about 20%, international jumped by about 50%. Higher yields on international routes vacated by Jet Airways have also led to the divergence in yield growth between Indigo and SpiceJet,” said analysts from Edelweiss Securities Ltd in a report on 21 August.

As such, capacity expansion helped both airlines clock handsome revenue growth. IndiGo’s revenues increased by about 45% and SpiceJet’s by 35%. On the profitability front, IndiGo’s Ebitdar, increased by a whopping 233% year-on-year to ₹2656 crore. Ebitdar is earnings before interest, tax, depreciation, amortisation and lease rentals. SpiceJet’s Ebitdar also jumped sharply by 88% to ₹684 crore.

Going ahead, yields will remain a key monitorable for investors. Here, from a near-term perspective, the scenario doesn’t look hunky dory.

“The yields have started to normalise in Q2FY20 as the impact of Jet Airways’ grounding has waned off,” Centrum Broking Ltd said in a report on 20 August. “While Q2FY20 is anyways a seasonally weak period, there is additional softening of yields due to lower fares in 0-15 day ticket booking window,” it added.

Severe disruption due to floods has made Q2FY20 even worse, point out Edelweiss analysts, adding, “We expect nominal yield growth at best, with potential for significant pick up during Q3FY20.”

As such, muted yield environment may well cap sentiment for airline stocks in the near future.



  1. Pingback: this contact form

  2. Pingback: porn

  3. Pingback: 안전바카라

  4. Pingback: 놀이터추천

  5. Pingback:

  6. Pingback: 카지노사이트

  7. Pingback: agen togel

  8. Pingback: orospu siteleri

  9. Pingback: How To Use Wealthy Affiliate 2020

  10. Pingback: where is maha pharma located

  11. Pingback: nationalpokerweek

  12. Pingback: how can tell if fake patek philippe watch 5960

  13. Pingback: English To Russian Translation

  14. Pingback: satta king

  15. Pingback: fish Tank Heater

  16. Pingback: ghi so de

  17. Pingback: 메이저놀이터

  18. Pingback: video transitions filmora 9

  19. Pingback: como entrar al negocio de bitcoin

  20. Pingback: immediate edge

  21. Pingback: fake swiss bvlgari replika watch

  22. Pingback: replica Big Watches

  23. Pingback: 토토사이트

  24. Pingback: Digital transformation company

  25. Pingback: kocioł parowy

  26. Pingback: Devops toolstack

  27. Pingback: Hyderabad plots for sale

  28. Pingback: xo so online

  29. Pingback: hack instagram

  30. Pingback: 야플릭스

  31. Pingback: good cvv2 online

  32. Pingback: sbo

  33. Pingback: denver magic mushroom shop​

  34. Pingback: to learn more

  35. Pingback: passive income

  36. Pingback: voir le site

Leave a Reply

Your email address will not be published.

1 × five =

News is information about current events. News is provided through many different media: word of mouth, printing, postal systems, broadcasting, electronic communication, and also on the testimony of observers and witnesses to events. It is also used as a platform to manufacture opinion for the population.

Contact Info

D 601  Riddhi Sidhi CHSL
Unnant Nagar Road 2
Kamaraj Nagar, Goreagaon West
Mumbai 400062 .

Email Id: [email protected]

West Bengal

Eastern Regional Office
Indsamachar Digital Media
Siddha Gibson 1,
Gibson Lane, 1st floor, R. No. 114,
Kolkata – 700069.
West Bengal.

Office Address

251 B-Wing,First Floor,
Orchard Corporate Park, Royal Palms,
Arey Road, Goreagon East,
Mumbai – 400065.

Download Our Mobile App

IndSamachar Android App IndSamachar IOS App
To Top
WhatsApp WhatsApp us