IndiGo moves fast to save on costs with business expected to be slow

ET Intelligence Group: If the topline is not in one’s control, then it is imperative to focus on what is: Costs. This summed up the strategy of India’s largest airline by market share, IndiGoNSE 9.15 %.

In its interaction with analysts, the management mentioned the shift in focus from profitability to liquidity. To achieve this, in the next nine months, it plans to save up to 4,000 crore in costs. That would involve negotiations with suppliers and staff, and replacement of less fuel-efficient aircraft with Airbus A320neo.

Ownership, fuel and maintenance costs are favourable for the Neo series instead of the existing Airbus series. The airline also expects moderately stable business in cargo.