Indigo to reap maximum benefit as Jet Airways, SpiceJet woes mount

IndiGo, the largest domestic carrier, is poised to reap the maximum benefit in terms of market share and better yields, as domestic airlines’ capacity has contracted sharply due to grounding of aircraft by Jet Airways and Boeing 737 Max fleet of SpiceJet, analysts maintain. Domestic traffic growth at 5.6% year-on-year was at 53-month low during February as aircraft groundings and repair work at second-busiest Mumbai airport kept airfares high.

Fares on key metro city routes have been up by around 25% y-o-y due to curtailed capacity of the carriers in March. Due to rise in airfares following cost escalations in H1FY19, the domestic passenger growth has significantly lagged behind the capacity expansion by airlines so far this fiscal.