InterGlobe Aviation’s stock price reached a new high recently, as investors were impressed by the airlines’ growth strategy. The company is expecting double-digit capex growth in the near future, which has increased confidence among stakeholders.
Brokerages have taken a cautiously optimistic stance on the stock, citing factors such as the pricing environment, fleet expansion strategies, and operational efficiency. Nuvama Institutional Equities, for example, has raised its FY25-27 EPS estimates by 8-13% based on positive guidance. Despite this, the brokerage has decided to maintain a ‘hold’ rating on IndiGo with a target price of ₹4,768, taking into account the premium valuations.
Motilal Oswal has reiterated a neutral rating on the stock with a target price of ₹4,660. The brokerage believes that as the market leader, IndiGo is well-positioned to capitalize on the growing domestic air travel trend, which is expected to double by 2030. Analysts are positive about the airline’s expansion plans, including adding more destinations, increasing international capacity share, and lowering overall leasing costs.
The airline has also been diversifying its revenue sources with initiatives such as IndiGo Stretch, BluChip, and a growing cargo division. It anticipates that the international segment will be a major driver of growth in the coming years. JM Financial, which has a hold rating on the stock, highlighted the potential for revenue growth in the upcoming quarter.
InCred Equities, on the other hand, has a reduce rating on the stock with a target price of ₹3,030, as it believes IndiGo’s growth expectations may be too optimistic. Despite this, global brokerages such as Morgan Stanley and Jefferies have maintained positive outlooks on the stock, with buy ratings and target prices of ₹5,700.
While the future looks promising for IndiGo, there are potential risks such as policy/regulatory uncertainty, adverse taxation structures, economic slowdown, rising competition, and higher oil prices. As of now, IndiGo’s shares are trading at ₹5,074.95 on the NSE, having reached a new high of ₹5,190.35 earlier in the day. The stock continues to attract attention from investors and analysts alike.
