IndiGo did everything right but the falling Rupee brought down it’s profits to losses
IndiGo flew 123.4 million passengers in FY26. Revenue grew. Capacity expanded 9.5%. Adjusted operating profit: Rs 7,502 crore. IndiGo did everything right but got jack hammered with a falling Rupee against the dollar. Rs 7,000 crore odd every quarter of jet fuel bought globally in dollars. A weaker rupee brings down IndiGo even when the price of crude oil remains stable. Then there is Rs 77,749 crore in dollar denominated liabilities across 400+ aircraft. the Rupee dropped and brought about a net loss of Rs 2,394 crore.
What is the solution for a robust airline company, with powerful processes such as IndiGo?
According to Royalle Corporation, IndiGo should create a holding company with more than one airline, with airlines other than IndiGo. These other airlines should be earning in US dollars or Euros. Next, these airlines should be in countries, which have good laws but do not have a dominant airline. These other airlines should have code share arrangements with IndiGo. The airlines other than IndiGo should clear Pakistani airspace from New Delhi as they are technically not Indian. IndiGo should continue to replicate the single model or single company of aircraft across this group of airlines. Let’s say create an Air Estonia with a hub in Tallin or Washington Airlines with a hub in Olympia. After this restructuring, report combined profits of the holding company. IndiGo (InterGlobe Aviation Ltd)
www.royalle.in
