Investors of the country’s largest airline IndiGo suffered a big shock on Friday. After the December quarter (Q3FY26) results came out, there was strong selling in the shares of InterGlobe Aviation. The company’s shares fell by nearly 4 per cent on BSE and slipped to an intra-day low of Rs 4724. Weak profit figures dashed market expectations.
Huge decline of 78% in profits
InterGlobe Aviation reported a consolidated net profit of Rs 550 crore in the December quarter, down nearly 78 per cent from Rs 2,449 crore in the same quarter last year. The company said that this sharp decline in profits was due to extraordinary expenses. These expenses include Rs 969 crore related to implementation of new labor laws, Rs 577 crore due to operational disruption and impact of Rs 1,035 crore due to currency movement on dollar-linked liabilities.
Picture is different on removing extraordinary expenses
However, the company says that if these extraordinary items are removed, its performance in the quarter was quite strong. After removing all these expenses and forex impact, IndiGo’s underlying net profit stood at Rs 3131 crore. At the same time, PAT (Profit after Tax) reached the level of Rs 3846 crore, which shows the operational strength of the company.
Strong return on quarterly basis
After suffering a loss of Rs 2582 crore in the September quarter (Q2FY26), IndiGo showed a strong recovery in the December quarter. The company’s revenue increased by 26 percent on a quarterly basis to Rs 24,500 crore. However, profit margins remained under pressure. PAT margin declined to 2.3 per cent, from 11.1 per cent a year ago.
Operational challenges became a hindrance
The airline’s CEO Peter Albers said there were large-scale operational disruptions between December 3 and 5, leading to the cancellation of many flights and inconvenience to passengers. Despite this, the company carried about 3.2 crore passengers in the quarter.
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