IndiGo, the country’s largest airline, may announce a record 500-aircraft agreement with Airbus SE as early as Monday, overshadowing Air India’s 470-plane deal in February.
Media reports said the deal would be signed Monday at the first day of the Paris Air Show, which will last till June 25.
The budget carrier is benefiting from a revival in air travel with the end of Covid restrictions even as it grabs more market share due to the absence of Go First which suspended operations from May 3.
The mega plane order will also help it to grow capacity in its international operations.
Besides the new order, there is a backlog of 500 planes from an earlier order of 800 A320s from Airbus. IndiGo has a fleet of 304 aircraft.
The latest order is likely to be of narrow-bodied A-320 family aircraft. IndiGo is also reportedly planning to buy 24 wide-bodied planes for which it is in negotiations with both Airbus and Boeing.
The airline serves close to 78 domestic and 26 international destinations.
In the fourth quarter ended March 31, 2023, it provided services to 30 additional international destinations through strategic partnerships.
At a con call after announcing its financial results for 2022-23, the management had indicated its plans to add 40-50 aircraft on a net basis in the current financial year, given that the present average fleet age is 3.5 years.
The airline had posted a net profit of Rs 919 crore in the January-March quarter compared with a loss of Rs 1,682 crore a year ago. This came on the back of a 76.5 per cent rise in revenues which expanded to Rs 14,161 crore from Rs 8,021 crore in the same period of the previous fiscal.
“IndiGo is expanding its international footprints. It is currently expanding to Southeast Asia and West Asia. Going forward, passenger traffic is expected to remain healthy, led by strong rebound in leisure and corporate travel and healthy forward bookings,” brokerage Geojit Financial Services said in a note.
“Marginal benefit from the grounding of competitor fleets is also likely. We expect revenue to grow by 17 per cent CAGR over 2023-23 to 2024-25,’’ Geojit said.
Data released by domestic aviation regulator DGCA has shown IndiGo gaining the most from the grounding of Go First.
Its market share went up nearly four percentage points in May to 61.4 per cent from 57.5 per cent in the preceding month. Its passenger load factor (PLF) also gained to 91.5 per cent from 87.4 per cent in April 2023.
Aviation safety regulator DGCA last week granted permission to the carrier to operate its flights to Nairobi in Kenya. This would be the airline’s first foray into the vast African region.
