Yields rise, cash burn lessens as IndiGo gradually recovers

InterGlobe Aviation Ltd, which runs budget airline IndiGo, posted better-than-anticipated earnings performance in the September quarter.

Net loss of ₹1,194.80 crore was lower than Bloomberg’s analysts’ consensus estimates of a loss of ₹1,604.8 crore. However, it was higher than the ₹1,062 crore loss seen in the same quarter last year. Revenue from operations stood at ₹2,741 crore, down 66% on a year-on-year (y-o-y) basis. This was expected given the huge drop in the number of flights and passenger load factors owing to the pandemic.

To some extent, the continued cost control measures and higher yield helped the airline’s earnings performance despite weak revenues. But note that most expenses fell at a much slower rate compared to the drop in revenues.