InterGlobe Aviation, which operates IndiGo, India's largest domestic airline, will report its second successive profitable quarter, while SpiceJet will slip into a loss in the fourth quarter FY23 amid higher traffic, strong loads and better yield than the same period last year, brokerages said in their Q4 results preview.
Domestic traffic in January-March is estimated to have grown 5-6 per cent sequentially and by over 50 per cent on a year-on-year basis. Traffic has crossed pre-Covid level and has sustained in the fourth quarter, which is traditionally a weak season for travel.
As such, passenger yield is expected to have declined 11.5-12 per cent sequentially due to the seasonality factor. However, on a YoY basis yield improved 8 per cent in Q4FY23, according to Elara Securities.
IndiGo, whose domestic market share rose to 55.9 per cent in February from 54.6 per cent the previous month, is likely to post a net profit of Rs 864 crore in Q4FY23, according to Centrum Institutional Research. Elara Securities and Emkay Institutional Research have pegged its net profit at Rs 1,134 crore and Rs 1,167 crore, respectively.
In the same period last year, InterGlobe Aviation had posted a loss of Rs 1,682 crore owing to high fuel expenses.
Elara Securities estimates SpiceJet to post a net loss of Rs 293 crore. While passenger volume is expected to have risen by 12 per cent YoY, it is likely to be flat sequentially, it said.
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"We remain positive on the aviation sector, given strong airfare discipline shown by the industry. Crude price softening augurs well for the sector. We remain positive on IndiGo as it is best placed to capture the expected 22 per cent demand growth in H2FY23 with its new-age Neo planes. International route expansion is expected to further bolster its bottom line," Elara Securities said.
