In the erratic world of the Indian aviation industry, InterGlobe Aviation Ltd. INDIGO, the parent company of Indigo Airlines, has been a consistent performer. The company’s shares have seen a significant uptick in recent times, with the stock price soaring over 6% in early trade on a Wednesday to hit ₹2,616.95.
The Investment: If you had invested ₹10,000 in Indigo’s IPO in 2015 at the upper limit of the price band, which was ₹765 per share, you would have bought approximately 13 shares. Based on the current share price of Indigo, the current value of this investment would be worth ₹34,020, which amounts to a 240.2% return on your money.
Background: Indigo Airlines has been making headlines with its strategic moves and robust performance. The company has been capitalizing on the misfortunes of its competitors, such as Go First’s insolvency, which has led to an increase in Indigo’s market share.
The company’s revenue from operations surged over 76% to ₹14,160.5 crore as against ₹8,020.75 crore in the March quarter of 2022. The company’s net profits for the quarter stood at ₹919.2 crore in the March quarter as against a loss of ₹1,681.8 crore loss it booked in the corresponding quarter last year.
Positive Events and Risk Factors: The collapse of Go First presented an opportunity for Indigo, with shares of the company surging in response to the news. The company is also primed to embark on a massive international expansion, adding six new destinations in Africa and Central Asia to its network. However, the company faces stiff competition from other airlines, including Air India, which is also ramping up its international expansion efforts.
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