IndiGo Reports Q1 Profit Dip Amid Rising Costs

DALLAS — IndiGo (6E), operated by Interglobe Aviation, announced its financial results for the first quarter of the fiscal year (Q1 FY25) on Friday, revealing a decline in profits despite robust air travel demand.

The carrier, which holds the largest market share in India, reported a profit of ₹2,727 crore (US$326 million) for the quarter ending June 30, representing an 11.7% decrease from the ₹3,087 crore earned in the same period last year.

The fall in profits can be attributed to a significant rise in expenses, which overshadowed the strong revenue growth. Total expenses for the quarter surged by approximately 24% to ₹17,449 crore, with aircraft fuel costs accounting for about 37% of the total.

Notably, aircraft leasing expenses more than tripled compared to the previous year.

Increase in Revenue

Despite these challenges, 6E's revenue from operations showed a healthy increase of 17.3%, reaching ₹19,571 crore. The airline also reported an 11.1% growth in available seat kilometres, a key metric measuring passenger carrying capacity, which aligns with the company's projected growth range of 10-12%.

However, the airline faced additional financial pressures, including a foreign exchange loss of ₹575 million, in contrast to a gain of ₹116 crore recorded in the same quarter last year. This shift further impacted the company's bottom line.

Outlook

Looking ahead, 6E has forecast high single-digit percentage growth for capacity in the upcoming quarter. This projection comes amid industry-wide expectations of rising costs, with a leading aviation consultancy predicting a 3.8% increase in expenses for Indian airlines in the fiscal year 2025.

As the aviation sector is not yet out of the pandemic-woods, 6E's performance reflects both the opportunities and challenges facing the industry.