Shares of InterGlobe Aviation rose over 3% today after Emkay Global initiated coverage on the operator of IndiGo airline with a buy call. InterGlobe Aviation stock gained 3.56% to Rs 2099.5 against the previous close of Rs 2027.25 on BSE. Earlier, InterGlobe Aviation shares opened higher at Rs 2,038.
Total 0.58 lakh shares of the firm changed hands amounting to a turnover of Rs 11.90 crore. The share trades higher than the 5-day, 20-day, 50-day, 100-day and 200-day moving averages.
The stock has gained 13.51% in one year and gained 2.37% since the beginning of this year. The shares have climbed 15.87% in a month. Market cap of the firm rose to Rs 79,454 crore.
The aviation stock hit 52-week high of Rs 2,282 on February 10, 2022 and a 52-week low of Rs 1,513 on June 20, 2022. The brokerage assigned a buy call to stock with a target price of Rs 2,560 for a year. The target amounts to an upside of 26.29% to the previous close of Rs 2,027.
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“We initiate coverage on Indigo, valuing it on DCF method (FY25-34), building Rs 4.6-4.7 long-term yield, Rs 3.9-4.0 CASK, fleet expansion to 652, ASK CAGR of 9%, PLF of 85-86% and WACC/TG of 12.7%/4%. Our target price of Rs 2,560 per share implies FY25E target P/E of 21x. Key risks: Adverse currency/fuel-prices, global recession hitting air travel and severe operational issues,” the brokerage said.
In the second quarter of the current fiscal, InterGlobe Aviation reported widening of losses to Rs 1,583.34 crore mainly due to higher expenses. The airline had a loss of Rs 1,435.66 crore in the year-ago period. Revenues rose to Rs 12,852.29 crore in the second quarter of the current fiscal, from Rs 5,798.73 crore in the same period a year ago. In the latest September quarter, total expenses rose to Rs 14,435.57 crore.