IndiGo's Current Troubles Don't Derail Upside, Says Citi Backing Further Gains — Check Target Price
IndiGo’s dense network and consequently stretched crew means that a delay in one flight can trigger a chain reaction across subsequent departures, noted the brokerage.
IndiGo’s management has attributed its recent operational turmoil to a confluence of unexpected challenges, including minor technology glitches, winter-related schedule changes, adverse weather, increased congestion, and the implementation of updated crew rostering rules under the new Flight Duty Time Limitations norms effective Nov. 1.
To stabilise operations, the airline has recalibrated its schedules, with brokerage firm Citi noting that the adjustments made over the next 48 hours should help normalise services and progressively improve IndiGo’s On-Time Performance (OTP). Management also said affected customers are being offered alternate travel arrangements or refunds.
Citi highlighted that OTP has deteriorated across airlines, but IndiGo’s larger and more complex network means disruptions escalate more rapidly. The new FDTL norms have also reduced roster flexibility, which could delay full normalisation.
However, the brokerage has a target price of Rs 6,500 for IndiGo, implying a 16% premium to IndiGo’s current levels. Citi said the premium is justified given IndiGo’s dominance, with nearly 65% domestic aviation market share.
OTPs Hit Across Airlines
Citi noted that OTPs have weakened industry-wide in December, largely because of adverse weather conditions, especially in northern India. However, the impact has been more pronounced this year due to the new FDTL norms. OTPs late in November were also affected by ash from the volcanic eruption in Ethiopia, Citi said, citing a media report from November 2025.
IndiGo’s dense network and consequently stretched crew means that a delay in one flight can trigger a chain reaction across subsequent departures. While the FDTL norms apply to all carriers, Citi said lower redundancy in IndiGo’s network could lead to a relatively higher operational impact. Since the norms are still new, recovery may take time.
According to Ministry of Civil Aviation (MoCA) data for Dec. 3 2025, OTPs were:
IndiGo: 19.7%
Air India: 66.8%
SpiceJet: 68.7%
Akasa Air: 67.5%
Implications
Citi expects near-term disruptions to continue. As IndiGo implements remedial steps and given the scale of its operations, the brokerage anticipates normalisation could take around one month.
Citi also flagged several downside risks to its target price:
Operational disruptions due to grounded aircraft and sustained engine issues
Rising competitive intensity from Air India (including Vistara) and expansion by new or existing carriers
Demand weakness amid softer consumer sentiment
Geopolitical risks impacting international operations
Higher cost pressures from a weaker rupee as compared to the dollar
Excess share supply over the next five years due to stake salesind
