Indigo Records Highest Q3 Profit, But Shares Fall Next Day?

Indigo, the largest Indian carrier in terms of passengers flown, has recorded the highest profit for third quarter ended December 2015 which is a good 24 % high than the same achieved in the same period in previous year. It achieved a profit of Rs 657.3 crores in 2015 as compared with 531.6 crores in 2014 Q3.

Indigo Crash

           Indigo Crash (courtesy:Economic Times)

However, just a day after, the stocks of the airline slumped a massive 19 percent, sending everyone guessing. Most observers feel that there are two main reasons for this. One, the performance in Q2 was rather subdued which meant that the airline was not as profitable as it was in Q1. Second, there was a news of delay in the delivery of fuel efficient new airbus aircraft A320neo version by Airbus which meant longer leases were to be secured for old airplanes, which directly impacts its future profitability.

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