Shares of InterGlobe Aviation, which operates IndiGo, fell for a fourth straight session as flight cancellations, slower air traffic and higher crude prices raise the risk of pressure on revenue and costs.
Domestic air traffic declined 0.3% in February 2026, while international traffic grew 0.7%.
Data for the first two days of March also shows lower passenger traffic. Domestic traffic stood at 4.8 lakh passengers compared with an average of 5.1 lakh in February. International traffic was 70,500 passengers against an average of 1.2 lakh in February.
Flight Disruptions
More than 500 flights to the Middle East have been cancelled till March 3, the company said in an exchange filing. Airlines cancelled 166 flights on March 1, followed by 162 flights on March 2 and 156 flights on March 3. Tentative data shows 57 cancellations on March 4.
Flight cancellations lead to notional revenue loss and fixed cost impact.
ALSO READ: IndiGo Reports Modest Air Traffic Growth And Lower Passenger Load Factor In January 2026
Revenue Impact
IndiGo's estimated capacity for the March quarter stands at about 4,637.5 crore available seat kilometres. International operations account for 30% of this capacity, while the Middle East accounts for 45% of international exposure.
This places about 626 crore available seat kilometres of capacity under pressure.
The estimated impact stands at about 206.6 crore available seat kilometres in one month, or about 6.66 crore available seat kilometres each day.
With a yield of Rs 5.3, the potential revenue loss stands at about Rs 35 crore each day. If the disruption continues through March 2026, the potential revenue loss could reach about Rs 1,095 crore.
Airlines continue to incur fixed costs even when flights do not operate. About 40% of airline costs remain fixed, while the remaining 60% are variable.
Based on IndiGo's Q3FY26 unit cost of Rs 4.73, fixed costs would be about Rs 1.89 per unit. This translates into a fixed cost impact of about Rs 12.6 crore each day. If the disruption continues through March, fixed costs could reach about Rs 391 crore.
ALSO READ: IndiGo Flight Cancellation Artificial? CCI Orders Extensive Probe Into Disruptions
Fuel Costs
Fuel remains a key cost component for airlines. Fuel accounts for nearly 40% of total costs, and IndiGo has limited fuel hedging.
For every $5 per barrel increase in Brent crude, earnings per share could decline about 13%, assuming the rupee remains constant.
Brent crude has risen to nearly $85 per barrel from $71 in the past three days. The cost impact will appear with a lag and will depend on crude prices remaining around current levels.
On Wednesday, The stock declined as much as 5% to Rs 4,293. Trading volume was more than triple its 20-day average, according to Bloomberg data. Among 27 analysts tracked by Bloomberg, 22 have a buy rating on the stock, while two analysts recommend sell and three analysts have a hold rating.
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