Motilal Oswal's research report on InterGlobe Aviation
The Indian aviation market is highly underpenetrated currently, which provides huge room for growth for domestic players. This growth trajectory will be aided by increasing airport infrastructure and capacity additions in terms of aircraft orders, which could make India the third-largest aviation market in the world by CY35. INDIGO highlighted its three-pillar strategy for growth: affordable fares, lower cancellations and on-time performance. It also seeks to enhance customer experience and invest in talent. INDIGO aims to significantly expand its international network. The management has also been making efforts to increase its global brand awareness. The stock is trading at ~14x FY26E EPS of INR238and 7x FY26E EV/ EBITDAR.
Outlook
We maintain our Neutral rating on the stock with a TP of INR3,510 as we believe that INDIGO would have to navigate through various challenges in the near to medium term.
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