NEW DELHI: Hit hard by falling value of Indian rupee against the US dollar and rise in jet fuel prices, country’s largest airline IndiGo on Friday reported a 94% decline in sequential profit for the quarter ending September 2023 (Q2FY24).
The profit after tax (PAT) of InterGlobe Aviation, the parent of the country’s largest airline IndiGo, came down to Rs 189 crore for the September quarter as against a PAT of Rs 3,091 crore reported in June quarter (Q1FY24). The airline had posted a loss of Rs 1,583 crore in the year-ago quarter (Q2FY23).It incurred a foreign exchange loss of Rs 617 crore in Q2. Rupee, owing to sustained foreign outflow and strengthening of the dollar index, is under tremendous pressure for past few months and has hit multiple lows.
Rupee closed 6 paise lower at 83.28 against the US dollar on Friday. IndiGo’s best ever quarterly profit in the June quarter was characterised by skyrocketing airfares following the collapse of Go First and softening fuel prices. Aviation turbine fuel (ATF) between June and September this year witnessed multiple hikes. ATF accounts for an airline’s 40% operational expenses, the sharp increase in its prices is likely to have put additional pressure on the airline’s profitability.
Revenue in the seasonally weak September quarter came at Rs 15,503 crore. In Q1FY24, the revenue was Rs 17,161 crore, the airline’e highest ever.IndiGo’s revenue per available seat kilometre (RASK) came down from Rs 5.12 in Q1FY24 to Rs 4.25 in Q2FY24. The airline’s yield (Rs /km) fell from Rs 5.18 in Q1FY24 to Rs 4.44 in Q2FY24. The two important metrics of an airline’s performance registered a year-on-year decline.
Fuel cost for IndiGo grew to Rs 5,856 crore in Q2FY24 from Rs 5,228 crore in Q1FY24. Cost per available seat kilometre (CASK) remained stagnant sequentially at Rs 4.19. Pieter Elbers, CEO of IndiGo said, “With our clear strategy and focus on execution, we have completed a full cycle and remained profitable for the last four quarters.”