India’s IndiGo posts lower first-quarter profit as forex losses weigh

Interglobe Aviation, the operator of IndiGo, posted a drop in first-quarter profit on Wednesday, hit by ballooning forex losses and softer growth following border tensions between India and Pakistan.

India’s largest airline by market share reported a profit of 21.61 billion rupees ($247.2 million) for the April–June quarter, down from 27.27 billion rupees a year earlier.

Foreign exchange losses more-than-doubled and total expenses rose 10%.

Analysts said the carrier has so far benefited from rising incomes, sustained post-pandemic travel demand, and continued fleet and network expansion.

But quarterly revenue rose only 4.7%, slower than the 17.3% growth logged in the year-ago quarter, hit by booking cancellations on some routes in April and May following a deadly border conflict between India and neighbouring Pakistan.

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Shortly following political unrest, a plane of rival airline Air India crashed in Ahmedabad and killed 260 people in June, spurring flying anxiety among many Indians.

“The June quarter was shaped by significant external challenges that created headwinds for the entire aviation sector,” Chief Executive Pieter Elbers said.

The company’s first-quarter capacity - measured in available seat kilometres - grew 16.4% on-year. The firm had projected of a “mid-teens percentage range” growth in May.

That helped IndiGo cushion a 5% drop in yields, which is the average money earned from a passenger for every kilometer travelled.

IndiGo shares closed 0.3% lower ahead of results.