Shares of InterGlobe Aviation, which runs IndiGo Airlines, rose 3% to an all-time high of Rs 4,098.45 on BSE in Thursday’s trade after the company placed an order for 30 Firm A350-900 aircraft. Meanwhile, domestic brokerage Kotak Institutional Equities increased the target price of IndiGo to Rs 4,700, signalling an upside potential of 15.5%.
“IndiGo’s wide-body aircraft order should be seen as an enabler to expand the range and size of its international offering, while not being central to its international growth strategy. As we await clarity on product and financing, we build in the lower end of the 6-12% impact that the 30-100 aircraft order can have; fair value increases to Rs 4,700 on roll forward,” stated the report by Kotak Equities.
