Shares of InterGlobe Aviation, which operates India's largest airline IndiGo, on Friday witnessed massive selling and nosedived by over 19% on investor concerns over the targeted fleet size by March due to delay in supply of more fuel-efficient planes by Airbus.
Shares of InterGlobe Aviation, which operates India's largest airline IndiGo, on Friday witnessed massive selling and nosedived by over 19% on investor concerns over the targeted fleet size by March due to delay in supply of more fuel-efficient planes by Airbus.
The stock plummeted by 19.10% to settle at Rs 968.75 on BSE. Intra-day, it slumped 20% to Rs 958. At NSE, shares of the company plunged 19.16% to end at Rs 968.30.
Tracking the extreme weakness in the stock, the company's market valuation tanked by Rs 8,242.46 crore to settle at Rs 34,909.54 crore.
In terms of volume, 17.70 lakh shares of the company changed hands at BSE and over one crore shares were traded at NSE during the day.
"Shares of InterGlobe Aviation failed to meet market expectations and were down by 20% intra-day as markets expected better numbers from the airline on the back of lower crude prices this quarter which could give a boost to the airline's bottom line," said Hiren Dhakan, Associate Fund Manager, Bonanza Portfolio Ltd.
InterGlobe Aviation yesterday reported 23.7% jump in net profit at Rs 657.28 crore for the three months to December, but said it will miss the 111-fleet target by March, following labour issues at Airbus.
The delays could throw a spanner in the ambitious growth plans of IndiGo, which has been betting on the more fuel-efficient A320 Neos (new-engine option), the delivery of which was to start from this month and had even told this to investors during the recent IPO launch.
As per the original plan, IndiGo was to induct 10 A320 Neos by this March 31, 2016, which would have further boosted its bottomline as these new planes consume up to 15% less fuel, which cost almost 35% of operational cost.
The carrier, which got listed in November 2015, had a net profit of Rs 531.57 crore in the year-ago period.
IndiGo's revenues climbed to Rs 4,407.49 crore in the third quarter of this fiscal, an increase of nearly 12% compared to Rs 3,938.79 crore in the same period a year ago.
Meanwhile, selling was also seen in other aviation counters with Jet Airways losing 6.36% and SpiceJet slumping by 5.03%.
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