InterGlobe Aviation shares surge 5% intraday, here is why

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Updated: March 11, 2016 4:44:14 PM

InterGlobe Aviation shares climbed as much as 5.28 per cent in the morning trade on Friday after reports that the airline major received the first of its Airbus A320 Neo aircraft.

InterGlobe Aviation, indigo sharesInterGlobe Aviation shares climbed as much as 5.28 per cent in the morning trade on Friday after reports that the airline major received the first of its Airbus A320 Neo aircraft. ( Express photo)

InterGlobe Aviation shares climbed as much as 5.28 per cent in the morning trade on Friday after reports that the airline major received the first of its Airbus A320 Neo aircraft.

At 11.39 am, InterGlobe Aviation shares were trading 3.85 per cent up at Rs 836.50. The scrip opened at Rs 822.75 and has touched a high and low of Rs 848 and Rs 813, respectively, in trade so far. Later, the share price closed 2.02 per cent up at Rs 821.75.

According to traders, A320 Neos burn less fuel and will help margin improvement for InterGlobe. The company expects to increase fleet size by 22.4 per cent by the end of FY 2017.

Earlier, the stock fell sharply this year on report that Airbus will delay aircraft delivery to InterGlobe. On a year-to-date basis, the share price of InterGlobe Aviation skid nearly 40 per cent to Rs 805.50 till March 10.

For the quarter ended December 2015, the company posted net profit of Rs 657.29 crore, up 23.65 per cent, against Rs 531.57 crore in the corresponding quarter a year ago.

According to JM Financial, InterGlobe Aviation (Indigo) is likely to witness the maximum fleet growth over the period FY17/18E and further increase its market leader position upwards of nearly 36 per cent market share during this period. The brokerage house has ‘Hold’ rating on Indigo shares.

(With inputs from Reuters)

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