Why Did IndiGo's Parent Company Lose Nearly Rs 37,000 Crore in Market Value Amid Flight Disruptions?
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Synopsis
InterGlobe Aviation has suffered a staggering loss of nearly Rs 37,000 crore in market value due to severe disruptions in IndiGo's flight operations. As analysts express concern over the airline's performance, the crisis management team works to stabilize operations. Discover the full story behind this significant market impact.
Key Takeaways
- InterGlobe Aviation has lost Rs 37,000 crore in market value.
- The stock fell by 10 percent in a single day.
- Flight cancellations were caused by adjustments to new duty-time regulations.
- The airline is working to stabilize operations by December 10.
- A high-level Crisis Management Group has been formed to tackle the issue.
Mumbai, December 8 (NationPress) InterGlobe Aviation Limited, the parent company of IndiGo, experienced a dramatic decline in its market value on Monday as the airline faced one of the most severe travel interruptions in the history of India’s aviation sector.
The stock plummeted by as much as 10 percent to Rs 4,842—marking its steepest single-day decline since February 2022—resulting in losses for the seventh consecutive session.
In just six trading days, the stock has recorded a 16.4 percent drop, erasing nearly Rs 37,000 crore in market capitalization.
The sell-off escalated as investors reacted to the ongoing wave of extensive flight cancellations and delays, which were triggered by IndiGo’s adjustment to the updated flight duty time limitation regulations.
Analysts have cautioned that these disruptions are dampening prospects for a robust earnings recovery.
Investment firm Investec has kept its ‘Sell’ rating on InterGlobe Aviation with a price target of Rs 4,040, noting that expectations for a third-quarter rebound have faded following a disappointing first half of FY26.
The situation worsened after the airline struggled to comply with the regulator’s deadline for the transition to the new duty-time guidelines.
IndiGo, along with another airline, requested additional time on December 7, citing operational challenges at various airports.
Although the regulator granted a short extension until 6 pm on December 8, it clearly stated that further leniency would not be permitted.
IndiGo has since reported improvements, claiming that operations are stabilizing and that the network is expected to be fully operational by December 10.
On Sunday, the airline operated over 1,650 flights, an increase from 1,500 the day before, and reported enhanced on-time performance, which rose to 75 percent from just 30 percent.
The company also indicated that its refund and baggage services are now operating at full capacity for both direct and indirect bookings.
In response to the crisis, IndiGo has established a high-level Crisis Management Group comprising Chairman Vikram Singh Mehta, board members Gregg Saretsky, Mike Whitaker, and Amitabh Kant, alongside CEO Pieter Elbers.
Their objective is to swiftly restore normal operations and address the surge in cancellations and delays.
Point of View
It is crucial to recognize that while InterGlobe Aviation faces significant operational challenges, the company's proactive measures and crisis management team may help mitigate the impact on consumer trust and market stability. Stakeholders must remain vigilant as the situation unfolds.
NationPress
25/01/2026
Frequently Asked Questions
What caused the market value drop for IndiGo's parent company?
The drop was primarily due to extensive flight cancellations and delays, driven by IndiGo's transition to new flight duty time regulations.
How much has InterGlobe Aviation's stock fallen?
InterGlobe Aviation's stock has fallen by 16.4 percent over the last six trading days.
What actions is IndiGo taking to address the disruptions?
IndiGo has formed a high-level Crisis Management Group to restore normal operations and manage the surge in cancellations and delays.
