Morgan Stanley has raised its target price on InterGlobe Aviation (IndiGo) to ₹6,085, maintaining its ‘Overweight’ rating as it expects a strong Q4FY25 performance and sees structural tailwinds supporting further re-rating of the stock.
The brokerage noted that supportive yields, tight industry capacity, and ongoing recovery from aircraft groundings (AOG unwind) should aid IndiGo’s fourth-quarter performance. In addition, a ramp-up in business class offerings and softer fuel prices are expected to provide incremental tailwinds.
Morgan Stanley also sees a re-rating in valuations as international operations ramp up, positioning IndiGo well for medium-term growth. The airline currently trades at FY26E and FY27E EV/EBITDA of 10.4x and 8.3x respectively, compared to its pre-COVID median of 8.5x.
The positive momentum in demand, better spreads, and capacity discipline position IndiGo as a key beneficiary in India’s aviation upcycle, the brokerage added.
Disclaimer: The above views are of the broker’s and not the author or the publication’s. Please make any and every investment decision after consulting your financial advisor.