InterGlobe Aviation shares plunged over 4 per cent on Monday after the aviation major on Friday reported flat growth in net profit at Rs 579.31 crore for the quarter ended March 2016.
InterGlobe Aviation shares plunged over 4 per cent on Monday after the aviation major on Friday after market hours reported flat growth in net profit at Rs 579.31 crore for the quarter ended March 2016. The largest domestic airline by market share had posted a net profit of Rs 577.33 crore in the same period a year ago.
Oil market companies (OMCs) also hiked aviation turbine fuel (ATF) prices by 1.5 per cent on Sunday which further impacted the low-cost carrier’s stock movement. Jet fuel constitutes over 40 per cent of an airline’s operating cost.
The share price of IndiGo closed 4.51 per cent down at Rs 1,023.80.
InterGlobe, which listed on the Mumbai stock exchange last year, said in a regulatory statement that net profit in its fourth quarter was up just 0.3 per cent to Rs 579 crore over the previous year, with increased revenue offset by higher aircraft and engine costs.
According to Kotak Institutional Securities, sharp increase in rentals and depreciation weighed on earnings. However, the brokerage house has ‘Buy’ rating on InterGlobe with price target price of Rs 1,200.
Other Aviation majors such as SpiceJet and Jet Airways were trading higher by 0.88 per cent and 0.73 per cent, respectively.
ATF price in Delhi was raised by Rs 627 per kilolitre, or 1.48 pr cent, to Rs 42,784.01 per kl.
Indian airlines, including SpiceJet Ltd, Jet Airways Ltd and GoAir, are benefiting from a 20-percent year-on-year rise in passenger numbers as more people fly, as well as lower fuel prices.
(With inputs from agencies)