Shares of InterGlobe Aviation Ltd (IndiGo) fell over 2% to ₹6,019.50 in early trade on Wednesday, August 21, after brokerage Kotak Institutional Equities downgraded the stock to “Add” from its previous “Buy” rating. The brokerage cited recent operational pressures and the sharp rally in IndiGo’s share price as reasons for the downgrade, while setting a revised price target of ₹6,850 per share.
Kotak noted that IndiGo’s capacity cuts are progressing faster than expected, with average monthly flight counts reduced to around 2,000 in recent months—down 11% and 9% versus Q4FY25 and Q1FY26 levels, respectively. This compares with Air India’s reductions of 10% and 8%. Aircraft induction has slowed to fewer than two per month, well below the earlier guidance of one per week.
Despite this, the brokerage stressed that it does not view the cuts as a sign of weakening demand. Instead, IndiGo is deploying these measures to protect yields ahead of the festive season. The airline is also phasing out damp leases and may defer new aircraft deliveries to manage costs in what is typically a weak quarter.
In comparison with Air India, IndiGo continues to retain cost leadership, supported by stronger customer preference and network reach. However, Air India’s load factors in August have temporarily surpassed IndiGo’s, hinting at competitive pricing dynamics ahead.
For Q1FY26, IndiGo reported a 20% YoY drop in net profit to ₹2,176 crore, missing analyst expectations, while revenue rose 4.7% YoY to ₹20,496 crore. Of the 25 analysts tracking the stock, 20 still recommend a “Buy”, while three suggest “Hold” and two advise “Sell”
