Share of InterGlobe Aviation, parent of the country’s largest airline IndiGo, fell over 4% today after the firm reported widening of its net loss to Rs 3,174 crore for the three months to June against Rs 2,844 crore loss in the year-ago period.
The firm reported its sixth consecutive loss in last quarter, its biggest ever. Losses widened due to a sharp fall in revenues amid the second wave of the coronavirus pandemic.
The airline stock opened with a loss of 2.16% at Rs 1,670 against previous close of Rs 1,706 today. InterGlobe Aviation share touched an intraday low of Rs 1,627, falling 4.68% on BSE.
The large cap share trades lower than 5 day, 20 day, 50 day, 100 day and 200 day moving averages. The share has gained 80% in one year and lost 4.68% since the beginning of this year.
Total 0.74 lakh shares changed hands amounting to turnover of Rs 12.57 crore on BSE.
Market cap of the firm fell to Rs 63,248 crore on BSE.
The carrier’s consolidated total income rose 177.2 per cent to Rs 3,170 crore in Q1 against Rs 1,143 crore in the first quarter of the previous financial year.
Total expenses climbed 59.2 per cent to Rs 6,344 crore in Q1 of 2021-22 compared to Rs 3,986 crore earlier.
However, brokerages are positive on the prospects of the share despite record quarterly loss.
Credit Suisse said the firm clocked large damage from COVID 2nd wave and would take time to recover. The brokerage stays focused on long-term potential amid trying times. Consolidation may play out given scale of damage to peers and ensuing lessors disputes. The brokerage gave a target price of Rs 2,100.
Morgan Stanley is overweight on the stock with a target price of Rs 2,292. Near-term earnings for the firm are tough to predict – but air travel opportunities, IndiGo’s competitive lead on the customer and cost fronts, and valuation have led to overweight stance on the stock, it said.
Jyoti Roy – DVP- Equity Strategist, Angel Broking is positive on the stock with a long-term perspective.
“Though the Q1FY22 numbers were below estimates, we believe that the worst is over for the company. We expect load factor to improve significantly from Q2FY22 in the aviation sector. We believe that IndiGo is best positioned in the Industry to ride out of the tough times and will continue to gain market share at the expense of other players, given the liquidity on the balance sheet. While near-term upsides may be limited, we continue to remain positive on the stock from a longer-term perspective, given a very strong balance sheet and continued market share gains,” said Roy.
