IndiGo Q1 net drops 11.7% to ₹2,728.8 crore on costs
The Hindu
IndiGo's Q1 profit drops 11.7% despite revenue increase, citing higher fuel costs and inflationary pressures.
Budget carrier IndiGo recorded an 11.7% year-on-year decline in net profit in the first quarter of this fiscal. During the April-June quarter, which is the peak travel season on account of summer break, IndiGo’s profit after tax (PAT) slid to ₹2,728.8 crore from ₹3,090.6 crore in the year-earlier period. This was despite an 11% increase in aircraft capacity and an 8.7% incrase in revenue per seat kilometre (the ability to raise airfares measured through yields). Total income rose 18% to ₹20,248 crore while total expenses surged 24% to ₹17,444 crore. Chief Financial Officer Gaurav Negi said in a post-result analyst’s call that the quarterly results were impacted by higher fuel costs, including due to some States that had cut VAT on aviation turbine fuel reversing them. There was also an increase in airport fee as well as inflationary pressures in maintenance, and growing lease rentals and employee costs.