IndiGo’s profit surges 53% as India air travel demand grows

IndiGo, India’s biggest airline, reported a profit for a fifth straight quarter as the budget carrier captured a higher share of passenger traffic during the period.

Net income rose 53% to 29.98 billion rupees ($362 million) in the three months through Dec. 31, IndiGo said in a stock exchange filing Friday. The airline exceeded Bloomberg’s consensus estimate of 21.27 billion rupees. 

Revenue for the third quarter beat estimates at 194.5 billion rupees, 30% above year-earlier levels. Fuel costs rose 18%. Its seat capacity rose 26.8% during the period. 

IndiGo is ramping up capacity to seize a bigger chunk of what is one of the world’s fastest-growing aviation markets. Its already large share, currently at 62%, has been growing considering rival SpiceJet Ltd. is struggling financially, while another budget carrier — Go Airlines — filed for insolvency and stopped operations in May. 

IndiGo last year made a 500-plane purchase from Airbus SE, a move that could help protect its position from an expanding Air India Ltd. 

IndiGo’s out of service aircraft have increased to “mid-70s” from 40 in the previous quarter due to required inspections of Pratt & Whitney GTF engines, Chief Financial Officer Gaurav Negi said on an earnings call. The carrier will rely on wet leasing aircraft to prevent a capacity shortage, he said. 

Still, it’s aiming to increase seat capacity by 12% in the fourth quarter, compared with the year before. 

The carrier flew 24.3 million passengers from October through December, 23% higher than the year before, according to the country’s aviation regulator.