What Did IndiGo Say At Analysts' Meet That Led To Brokerage Upgrades And Stocks Soaring?

Shares of IndiGo operator InterGlobe Aviation were surging on Tuesday after several brokerages rolled out strong growth forecasts for the low-cost carrier following its analysts’ meet.

What Happened: Following the analyst meet on March 22, brokerages such as UBS Securities, Kotak Institutional Equities and Motilal Oswal Financial Services expressed strong growth potential for IndiGo, backed by its expansion plans and robust growth projections for India’s aviation industry.

Motilal Oswal Financial Services believes that the Indian aviation market remains highly underpenetrated, offering significant room for growth for domestic players. The firm anticipates that increasing airport infrastructure and capacity additions, including aircraft orders, could propel India to become the world’s third-largest aviation market by 2035.

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Other brokerages shared the optimism regarding the long-term growth outlook for domestic air travel, with projections suggesting a robust 15% compounded annual growth rate over FY24-30.

Brokerages have assigned price targets ranging from ₹3,500 to ₹4,300 for IndiGo, reflecting a potential upside of 7%-31% from the previous close.

Down To The Numbers: UBS Securities raised its target price by 2.5% to ₹4,000, valuing the stock at 11 times its expected FY26 EV/EBITDA. Despite considerations for increased crude prices and pilot salaries, UBS maintains a bullish outlook, driven by improved available seat kilometer (ASK) growth and yields.

Kotak also underlined IndiGo’s shift in focus towards international journeys and investments in systems and operations. It raised its target price to ₹4,300 while retaining its “buy” call.

ICICI Securities also held a positive view on InterGlobe Aviation, citing favourable demand-supply dynamics and its strong market position. The brokerage maintained a “buy” call with a price target of ₹4,009.

MOFSL acknowledges IndiGo’s growth strategy but retained a “neutral” rating on the stock with a price target of ₹3,510, citing potential challenges in the near to medium term.

Price Action: IndiGo’s share price surged 5.33% in afternoon trade to ₹3,462.00, hitting an all-time high.

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Posted In: EquitiesUpgradesPrice TargetMarketsAnalyst RatingsMoversTrading IdeasIndigoInterGlobe Aviation