The only 'bearish' stance on IndiGo after Q4 results even as 80% analysts say 'buy'

Shares of InterGlobe Aviation, the parent of IndiGo, will be in focus on Monday, June 1, after the airline reported a net loss of more than ₹2,500 crore for the March quarter, impacted largely by sharp foreign exchange losses and one-time expenses.

The airline said the rupee's nearly 5% depreciation during Q4FY26 resulted in foreign exchange losses of ₹4,823 crore, weighing on profitability.

IndiGo said that its natural hedge from international operations was disrupted during the quarter, amplifying the impact of currency volatility.

Despite the loss, the airline's operational performance remained resilient. Revenue for the quarter rose 6% year-on-year, while annual revenue touched a record high of nearly ₹90,000 crore.

Profit after tax, excluding forex losses and exceptional items, stood at ₹1,920.6 crore compared to ₹2,981.1 crore a year ago, showing a 36% decline.

Profitability was further affected by a one-time charge of around ₹250 crore related to the implementation of changes under the labour code during Q4FY26.

Looking ahead, IndiGo has guided for capacity growth of 3% to 4% year-on-year in the first quarter of FY27.

The airline also expects passenger revenue per available seat kilometre (PRASK) to improve by a mid-teen percentage compared to Q1FY26.

During the earnings call, Managing Director Rahul Bhatia acknowledged that the disruptions witnessed in December had a financial impact on the airline and affected customer experience.

IndiGo stock recommendations

Following IndiGo's fourth-quarter results, 80% of the 26 analysts tracking the stock have a 'Buy' recommendation on it, while about 7% have a 'Sell' rating.

Brokerage firm Goldman Sachs maintained its 'Buy' rating with a target price of ₹5,200. The brokerage said that IndiGo reported a pre-tax loss of ₹2,100 crore, better than its estimate of a ₹3,590 crore loss.

Lower-than-expected operating costs, particularly supplementary rentals and airport charges, along with slightly better yields, helped offset some pressure.

Goldman also pointed to management's guidance for 3-4% capacity growth and a mid-teen increase in PRASK in the June quarter.

BofA Securities reiterated its 'Buy' rating and ₹5,100 target price. While the March-quarter performance broadly met expectations and reflected the initial impact of the Iran conflict on capacity and costs, the brokerage said the outlook was better than anticipated.

It pointed to the airline's mid-teen passenger revenue growth guidance as evidence of strong cost recovery and expects easing geopolitical and operational disruptions to shift investor focus back to growth.

Jefferies retained its 'Buy' rating but trimmed its target price to ₹5,380. The brokerage described the quarter as weak but largely in line with expectations.

It expects near-term earnings pressure to persist amid elevated costs but believes IndiGo is better positioned than peers. Jefferies also said that the airline is prioritising profitability and capacity optimisation, forecasting ASK growth of 5-6% in FY27.

Kotak Institutional Equities maintained its 'Buy' rating and ₹5,400 target price. The brokerage said IndiGo's net loss of ₹2,300 crore was lower than anticipated despite a foreign exchange loss of ₹4,500 crore, most of which was mark-to-market in nature.

Kotak said that aircraft groundings continued to weigh on profitability, although most of the expected relief is likely to materialise in FY28. It also highlighted stronger pricing trends in the current quarter, indicating the airline is testing demand elasticity.

Investec retained its 'Sell' rating and ₹4,050 target price. The brokerage said FY26 was impacted by capacity constraints, Middle East-related disruptions, elevated aviation fuel costs and rupee depreciation.

It expects earnings pressure to continue in the first half of FY27, citing modest capacity growth guidance and persistent cost headwinds.

Investec has cut its FY27 and FY28 earnings estimates by 12% and 5%, respectively.

Motilal Oswal Financial Services reiterated its 'Buy' rating with a target price of ₹5,600. The brokerage said IndiGo's operating performance exceeded expectations despite the impact of the West Asia conflict and higher foreign exchange losses.

It remains positive on the airline's long-term growth strategy, supported by strong domestic demand, international network expansion, easing aircraft groundings and planned fleet additions.

Motilal Oswal expects revenue and EBITDAR to grow at a CAGR of 13% and 46%, respectively, between FY26 and FY28.

Nuvama Institutional Equities has upgraded IndiGo to 'Buy' and assigned a price target of ₹5,054 per share. The brokerage said IndiGo remains well-positioned to navigate near-term challenges while capitalising on long-term growth opportunities, particularly by replicating its successful domestic strategy in the international aviation market.

According to Nuvama's analysis, the stock has historically rebounded between six and 24 months after sharp corrections.

The brokerage believes weak Q1FY27 earnings expectations are already reflected in the stock price and valuations remain attractive at around 16x FY28 earnings.

Shares of InterGlobe Aviation ended 3.28% lower at ₹4,420 on Friday and are down nearly 14% so far in 2026.