IndiGo Defers Salary Hike For Senior Employees Amid Aviation Sector Headwinds

InterGlobe Aviation Ltd., the parent company of IndiGo, has deferred salary hikes for senior employees as the airline grapples with elevated fuel costs and a volatile operating environment, Chief Financial Officer Gaurav Negi said during the company's earnings call on Thursday.

The airline also said it is rationalising capacity on select domestic and international routes while continuing to maintain its capacity growth guidance for fiscal 2027.

The comments came after IndiGo reported a consolidated net loss of Rs 238 crore for the first quarter of fiscal 2027, compared with a net profit of Rs 2,176 crore in the corresponding period last year. Despite the loss, revenue rose 20% year-on-year to Rs 24,584 crore.

Speaking on the earnings call, IndiGo co-founder Rahul Bhatia said fuel costs remain elevated in the near term and the operating environment continues to be volatile. He noted that the airline was able to pass on only a limited portion of the increase in fuel prices to passengers.

ALSO READ: IndiGo Q1 Results: Airline Slips Into Net Loss Even As Revenue Climbs 20%; Fleet Count Falls

Negi said revenue improved during the quarter due to fare hikes, although April was the most impacted month. He described May as the strongest month for the aviation industry during the quarter, while June remained constructive with yields holding firm and international capacity improving.

According to management, pricing discipline has continued into the second quarter of fiscal 2027, with passenger load factors remaining largely stable. The airline reiterated its fiscal 2027 capacity growth guidance of single-digit expansion and indicated that growth could move into the early double-digit range thereafter.

Q1 Performance Under Pressure

While revenue grew strongly, profitability came under pressure due to higher costs.

Ebitar, adjusted for foreign exchange impact, fell 34% to Rs 3,889 crore from Rs 5,866 crore. The corresponding Ebitar margin dropped to 15.8% from 28.6%, down 1,280 basis points.

The airline's fleet count stood at 432 aircraft at the end of the quarter, down by nine aircraft from the previous quarter.

IndiGo Q1 Result Highlights (Cons, YoY)

• Revenue rose 20% to Rs 24,584 crore from Rs 20,496 crore
• Ebitda fell 37% to Rs 3,267 crore from Rs 5,227 crore
• Ebitda margin declined to 13.3% from 25.5%
• Ebitar fell 34% to Rs 3,889 crore from Rs 5,866 crore
• Ebitar margin declined to 15.8% from 28.6%
• Net profit swung to a loss of Rs 238 crore from a profit of Rs 2,176 crore in the year-ago quarter

Management said the industry environment remains dynamic, though improving yields, stable load factors and continued pricing discipline provide support as the airline navigates higher fuel costs and adjusts capacity deployment across its network.

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