InterGlobe Aviation Q1 Preview: Airline to post profit vs loss a year ago on higher traffic, airfares

economictimes.indiatimes.com:

InterGlobe Aviation report a profit for the quarter ended June 2023 as against a loss a year ago. The operator of IndiGo airlines is seen reporting a consolidated net profit of Rs 1,769 crore compared to a loss of Rs 1,064 crore a year ago.

Sequentially, the net profit is seen rising 23%. Consolidated revenue is likely to grow 22% year-on-year (YoY) and 11% sequentially to Rs 15,895 crore, according to the average of estimates given by four brokerages.

The country’s largest carrier is slated to release its quarterly earnings on Wednesday.Here are the analysts’ earnings expectations from the airline operator:Kotak Institutional EquitiesWe expect a 40% YoY and 16% QoQ increase in passenger count, largely driven by higher ASK (available seat kilometres) and higher load factor at 9%. We build a 5% QoQ increase in yields while lowering support of other operating income (payment for grounded planes).

Available Seat Kilometres measure an airline's carrying capacity to generate revenue, and this is taken by multiplying the available seats on any given aircraft by the number of kilometres flown on a given flight.Motilal Oswal SecuritiesExpect RPK (revenue passenger kilometre) at 28.2 billion (+29% YoY), PLF at 89.5% (up from 79.6% in 1QFY23) and ASK of 31.5 billion (up 14% YoY). Average fare prices were higher by 7% on 1-month forward bookings, while they were up 15% on 15-day forward bookings.

Will watch out for the outlook on new aircraft deliveries from Airbus, expansion to new tier-II and tier-III routes, and addition of newer international destinations. The most significant monitorable will be sustainable earnings, going forward in FY24, with demand remaining robust but airfares also being on the higher side.Nuvama