tanked 8.2 per cent to Rs 4926.55 on Monday amid ongoing flight disruptions and adverse commentary from rating agency Moody’s.
On Monday IndiGo flew 1800 flights (up from 1650 on Sunday) and its on time performance improved to 91 per cent. The airline said it has reduced the number of cancellations and is progressing further on the path of full recovery.
Yet these measures have done little to assuage passengers as large scale cancellations persist. On Monday around 450 cancellations (departures plus arrivals) were reported at major airports.
Investor sentiment too remains negative with the risk of regulatory action adding pressure. Monday saw the seventh straight day of fall in its stock price and 8.2 per cent fall was its biggest slide since February 2022. In all since the past week the airline’s stock has seen market capitalisation erosion of nearly ₹37,000 crore.
Flight disruptions credit negative :Moody’s
Flight disruptions credit negative : Moody’s
Rating agency Moody’s on Monday said flight disruptions are credit negative for IndiGo as the airline could face significant financial damage from loss of revenue because of flight cancellations, refunds and other compensations to affect customers along with potential penalties imposed by the Directorate General of Civil Aviation.
On its part IndiGo has said it has refunded ₹827 crore to affected passengers and more is under process. The airline said it booked 9500 hotel rooms and 10,000 cabs/buses for those stranded due to disruption.
“Over 4500 bags have been delivered to customers and we are on track to deliver the rest in the next 36 hours,” IndiGo said in a statement.
Strict action will be taken: Civil aviation minister Naidu
Meanwhile, responding to questions in the Rajya Sabha, civil aviation minister Ram Mohan Naidu Kinjarapu said the disruption issue has not been taken lightly and an inquiry is on. He said the government will take strict action against those responsible and set an example of zero tolerance of non compliance.
The minister said multiple consultations were held with airlines before the implementation of the new flight duty time norms. Naidu said the government has been very clear that there will be no compromise with safety and even when airlines sought variations these were granted after a risk assessment.
Naidu said it was IndiGo’s job to manage rosters and crew for daily operations. On December 1,the airline had a meeting with the regulator and sought certain clarification on duty time norms but it did not flag any issues.