IndiGo will aim to grow its revenues and bottom line in the high teens when compared on year in 2023-24, the airline's Chief Executive Officer Pieter Elbers said on May 18, as India's biggest airline reported a profit of Rs 919 crore in the March quarter.
Speaking in a post-earnings conference call, Elbers said IndiGo is seeing robust demand for flying in current quarter and yield is higher when compared to the year-ago period that saw capacity constraints in the domestic market.
"Due to the grounding of a competitor there is limited capacity in the domestic market at the moment," Elbers said.
He added that it would be very premature to comment on acquisition of any aircraft that may be available domestically in India, due to a competitor being grounded.
ALSO READ: IndiGo Q4 Results: Airline posts net profit of Rs 919 cr on back of healthy demand for air travel
The airline's Chief Financial Officer Gaurav Negi also said that IndiGo does not foresee an increase in its leasing costs despite any disruptions in the Indian market.
"Lessors are looking at IndiGo more favorably due to its track record and we don't expect leases to rise, apart from the due to currency fluctuations," Negi said.
Elbers also said that he does not expect any more of IndiGo's planes to be grounded growing forward as all the new planes coming in were fitted with CFM International LEAP engines.
"We continue to work on supply chain issues but are confident that growth will not be hampered by grounded planes," Elbers said.
At the moment, IndiGo has around 35 planes grounded due to supply chain-related engine issues at the moment, and the number is unlikely to increase going forward, the executive added.
IndiGo's strategy on international routes was very similar to its domestic strategy and the airline "plans to focus on reliability, competitive prices, and punctuality on our international operations to grow," Elbers said.
He reiterated that IndiGo will soon launch new flights between India and Nairobi in Kenya and Jakarta in Indonesia.
Negi added that IndiGo aims to add 40-50 aircraft in terms of gross additions in 2023-24 after adding 19-20 aircraft in 2022-23. Net aircraft additions last FY were lower due to supply chain-related issues.
He also said that IndiGo added around 35 aircraft to its fleet through wet leases or extension of leases. IndiGo also plans to hire nearly 5,000 employees in 2023-24, Negi said.
IndiGo's profit fell 35 percent from Rs 1,423 crore in the preceding December quarter, when compared on a sequential basis.
Revenue from operations during the March quarter rose 76 percent year-on-year to Rs 14,160 crore. It was Rs 8,021 crore in the corresponding quarter of last year.
Passenger ticket revenues during the fourth quarter rose 81 percent to Rs 12,435 crore, while ancillary revenues were Rs 1,445 crore, showing an increase of 37 percent compared to the same period last year.
IndiGo said the profits of the third and the fourth quarters largely compensated for the losses incurred in the first and the second quarters.
For the full year, the airline reported a net loss of Rs 306 crore. Excluding the foreign exchange impact, the Gurugram-based company posted a profit of Rs 2,654 crore for FY23.
"With a combination of robust market demand and focused execution of our strategy, this was the second consecutive quarter wherein we produced strong operational and financial results, as we reported the highest ever fourth quarter net profit," said Elbers.
IndiGo recorded a massive 1,627 percent surge in its EBITDAR (earnings before interest, tax, depreciation, amortisation and rent) at Rs 2,966 crore during the fourth quarter under review.
Total expenses for the quarter ended March were at Rs 13,680 crore, an increase of 38 percent over the same quarter last year. Average fuel prices increased by 23 percent leading to increase in fuel CASK (cost per available seat kilometre) by nearly 17 percent to Rs 1.85.
Meanwhile, CASK (ex-fuel) dropped 21 percent to Rs 2.53 due to higher capacity.
Operationally, the airline's capacity increased 49 percent to 30.4 billion during the March quarter, while passenger numbers jumped 60 percent to 23.4 million.
Yields during the fourth quarter improved by 10 percent to Rs 4.85, while load factor improved by 7.5 pts to 84.2 percent.
The revenue per available seat kilometre (RASK), on the other hand, rose 18 percent to Rs 4.68 during the March quarter. The company expects capacity in terms of ASKs to increase by around 5-7 percent QoQ in the first quarter of FY24.
IndiGo had a total cash balance of Rs 23,424 crore, comprising Rs 12,195 crore of free cash and Rs 11,229 crore of restricted cash, as of the March quarter.
As of March 2023, the airline had a fleet of 304 aircraft including 21 A320 CEOs, 162 A320 NEOs, 79 A321 NEOs, 39 ATRs, 2 A321 freighters and 1 B777 (damp lease); a net increase of 2 passenger aircraft during the quarter. IndiGo operated at a peak of 1,815 daily flights during the quarter including non-scheduled flights.
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