Here’s why Indigo stock rallied over 6% in trade today

Shares of Interglobe Aviation or Indigo surged over 6% in trade on Wednesday and ended the session at Rs 2,164, up 4.6%.

Shares of Interglobe Aviation or Indigo surged over 6% in trade on Wednesday and ended the session at Rs 2,164, up 4.6%, largely due to expectations of a positive impact on the company after GoFirst Airlines on Tuesday filed for bankruptcy amid cash crunch.

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GoFirst filing for insolvency is expected to remove 9% of domestic supply in the aviation sector, which could largely benefit Indigo. Brokerage firm Credit Suisse also says that the crisis for GoFirst could benefit Indigo through higher market share and stronger yields in a capacity constrained environment. Further, increasing leverage with global OEMs of engines & planes lessors may be keen to allocate some of the GoFirst aircraft to Indigo given similar fleet type.
According to Credit Suisse, a similar case happened back in favor of Spicejet when Jet Airways shut operations based on fleet type overlap.
As on March 2023, Indigo is the leader in the domestic market with a share of 57%.