IndiGo Q2 FY25 Earnings: Will India's Largest Airline Maintain Profitability for the Eighth Quarter? - Read Now

IndiGo Q2 FY25 Earnings: IndiGo, the largest carrier of India in terms of fleet and market share for the home market, is expected to announce its Q2 FY25 results today. And that will be done just after two big changes in the horizon: Vistara has merged into Air India, and relatively recently, AIX Connect, earlier called AirAsia India, became a part of Air India Express. After almost two decades of successful existence since its launching in 2006, IndiGo had faced its most despondent competition ever.

IndiGo is undoubtedly one investment and industry analyst curious to see if it can keep up the kind of run of seven straight quarters of profitability into the eighth quarter as well. By tradition, Q2 is traditionally a weaker quarter for airlines. The result will include undisclosed compensation from Pratt & Whitney, which the airline is not allowed to disclose due to contractual obligations.

IndiGo Q2 FY25 Earnings: The Current Market

IndiGo has carried 2.44 crore domestic passengers in the quarter, growing modestly by 5% QoQ from Q2 FY24. Nevertheless, on absolute counts, these figures are slightly down from Q1 FY25. IndiGo had sequential decline notwithstanding, yet built market share because of slower growth for Air India Express as also the huge decline in operations of SpiceJet.

The same trend continued in the last seven quarters, wherein IndiGo has posted outstanding profitable performances. At ₹12,790 crores, its estimated profit for Q2 FY25 is ₹189 crore. Steady growth at international levels also characterized IndiGo with an increase in frequency that boosted the capacity and passenger numbers.

Despite strong market positioning, IndiGo has approached capacity addition cautiously in this quarter. The falling oil price and only a slight depreciation of the rupee have been weighing well in cost stabilization, particularly in dollar-denominated leasing cost. Nevertheless, load factors have persistently been lower than those of full-service carriers like Air India and Vistara.

Investors would like to know if the maintenance cost base is developing and, specifically, how it has been for IndiGo's older A320ceo fleet. The carrier always posts Pratt & Whitney compensation as revenue without indicating whether it is taking cash, inkind compensation, or something in between.

IndiGo is expected to announce its earnings. Key things to watch out for are capacity guidance for the quarter that sees the peak demand and new destination unveilments. There are also whispers on whether the management might throw some clarity on operational changes ahead of the Vistara-Air India merger.

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