IndiGo shares closed flat at Rs 1,185 on Monday, after IndiGo, India’s biggest airline by market share, said that it’s keen on opportunities in the regional aviation market as well as low cost long haul international flights. The no-frills airline, which has the largest share in the domestic aviation market, expects to have 20 turbo prop aircrafts by January 2019, which it plans to deploy on the regional routes under the UDAN scheme initiated by the government of India. Some of the routes under Udan flights are Bhatinda- Delhi, Gwalior-Indore, Gwalior-Lucknow, Pathankot-Delhi, Agra-Jaipur, Diu-Surat, Jamnagar-Ahmedabad, Kanpur-Varanasi, Pondicherry- Chennai and Bilaspur-Raipur.
The company is looking to target under-served areas. In May, IndiGo had announced plans to buy 50 ATR turbo-prop planes worth USD 1.3 billion as part of efforts to tap the regional aviation market. With regard to plans for low cost long haul overseas flights, Ghosh told shareholders today that it would “pursue both organic and inorganic opportunities”.
“We believe there is a significant opportunity that exists to traffic from high cost non-stop operators with right kind of low-cost non-stop services out of India. We are uniquely positioned to take advantage of this, primarily because of our significant domestic network,” President Aditya Ghosh said.
IndiGo’s outstanding order for aeroplanes — the largest for any airline in the world — is a testament to this ambition. The airline has 458 aircraft on order, scheduled for delivery over the next decade, to add to its existing 135 aircraft, which is also the largest fleet for any airline in India.
The airline, operated by Interglobe Aviation, has made no secret about its plans to fly to more and more cities overseas, but so far is in nascent stages and is a small player with a paltry 3% market share. It flies to seven destinations overseas in six countries, all in Asia — three in the Middle East, two in southeast Asia, and one in south central Asia. Further, its expansion overseas is contingent upon the staggered delivery of the aircraft over the next 10 years.