Motilal Oswal's research report on InterGlobe Aviation
InterGlobe Aviation (INDIGO) reported an EBITDA growth of 4% YoY to INR51.5b in 1QFY25, while PAT declined 12% YoY to INR27.3b (vs. our est. of INR15.7b). Revenue passenger kilometers (RPK) was 31.5b. The passenger load factor (PLF) was 86.8% with available seat kilometers (ASK) at 36.3b (est. of 35.5b) and yield at INR5.24 (vs. est. of INR4.72, +1% YoY) in 1QFY25. Currently, INDIGO’s ~70+ aircraft are grounded due to P&W engine issues, and the management believes this number would be range-bound. INDIGO added incremental 17 destinations (10 domestic and 7 international) YoY in 1QFY25 while highlighting the fact that the Indian market is still underpenetrated both in terms of domestic and international travel.
Outlook
The stock is trading at ~22x FY26E EPS of INR200 and FY26E EV/EBITDAR of ~11x. We reiterate our Neutral rating on the stock with a TP of INR4,420, based on 9x FY26E EV/EBITDAR.
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