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Shares of InterGlobe Aviation
, the parent company of IndiGo, opened lower on Monday, March 16, after the airline announced a fuel surcharge across all domestic and international routes amid the ongoing war in West Asia.
The airline is grappling with a sharp rise in aviation turbine fuel (ATF) prices triggered by the ongoing conflict involving Iran, United States, and Israel in West Asia, according to a company statement.
Brokerage firms have also reacted to the development. Citi has maintained a 'Buy' rating on the stock with a price target of ₹5,100 per share, implying a potential upside of 23% from current levels.
The brokerage said IndiGo's operations in the Middle East have been affected by the adverse geopolitical situation in the region.
The airline has adjusted its operations on Middle East routes, operating 36 daily flights between March 16 and March 28, 2026, sharply lower than the earlier schedule of around 150-160 flights per day before the disruption.
To offset the sharp rise in jet fuel prices, IndiGo has introduced a fuel surcharge effective March 14, 2026. Domestic and Indian subcontinent passengers will be charged an additional ₹425 per sector, while international passengers will pay a surcharge ranging between ₹900 and ₹2,300 depending on the route.
Since the surcharge is being applied across sectors, the brokerage estimates the impact on yields could be significant, potentially improving them by 8-10%.
UBS also maintains a 'Buy' recommendation on InterGlobe Aviation with a price target of ₹5,480 per share. The brokerage views the airline's decision to introduce a fuel surcharge across all routes as a meaningful positive.
UBS added that if fares, including the surcharge, remain elevated for a sustained period, IndiGo would have sufficient cushion to absorb higher crude oil prices, limiting the earnings impact even if crude rises to around $83 per barrel.
IndiGo earlier said the move follows a surge in fuel prices linked to ongoing geopolitical tensions. The airline cited the Jet Fuel Monitor by the International Air Transport Association, which has recorded an increase of over 85% in regional fuel prices.
ATF accounts for a significant portion of airlines' operating costs. IndiGo said the sudden and sharp increase in fuel prices will materially impact the cost structure and network planning of airlines, including its own.
The airline added that fully offsetting the impact of the surge in fuel prices would require a substantial increase in airfares.
The revised fuel surcharge per sector for new bookings will be ₹425 for domestic India and the Indian subcontinent, ₹900 for Middle East routes, ₹1,800 for South East Asia and China as well as Africa and West Asia, and ₹2,300 for Europe routes.
22 of the 27 analysts covering the stock have a 'Buy' rating, while three have 'Hold' ratings and two recommend 'Sell'.
Shares of InterGlobe Aviation settled 2.11% lower on Friday at ₹4,162. The stock has declined 19% so far in 2026.
The airline is grappling with a sharp rise in aviation turbine fuel (ATF) prices triggered by the ongoing conflict involving Iran, United States, and Israel in West Asia, according to a company statement.
Brokerage firms have also reacted to the development. Citi has maintained a 'Buy' rating on the stock with a price target of ₹5,100 per share, implying a potential upside of 23% from current levels.
The brokerage said IndiGo's operations in the Middle East have been affected by the adverse geopolitical situation in the region.
The airline has adjusted its operations on Middle East routes, operating 36 daily flights between March 16 and March 28, 2026, sharply lower than the earlier schedule of around 150-160 flights per day before the disruption.
To offset the sharp rise in jet fuel prices, IndiGo has introduced a fuel surcharge effective March 14, 2026. Domestic and Indian subcontinent passengers will be charged an additional ₹425 per sector, while international passengers will pay a surcharge ranging between ₹900 and ₹2,300 depending on the route.
Since the surcharge is being applied across sectors, the brokerage estimates the impact on yields could be significant, potentially improving them by 8-10%.
UBS also maintains a 'Buy' recommendation on InterGlobe Aviation with a price target of ₹5,480 per share. The brokerage views the airline's decision to introduce a fuel surcharge across all routes as a meaningful positive.
UBS added that if fares, including the surcharge, remain elevated for a sustained period, IndiGo would have sufficient cushion to absorb higher crude oil prices, limiting the earnings impact even if crude rises to around $83 per barrel.
IndiGo earlier said the move follows a surge in fuel prices linked to ongoing geopolitical tensions. The airline cited the Jet Fuel Monitor by the International Air Transport Association, which has recorded an increase of over 85% in regional fuel prices.
ATF accounts for a significant portion of airlines' operating costs. IndiGo said the sudden and sharp increase in fuel prices will materially impact the cost structure and network planning of airlines, including its own.
The airline added that fully offsetting the impact of the surge in fuel prices would require a substantial increase in airfares.
The revised fuel surcharge per sector for new bookings will be ₹425 for domestic India and the Indian subcontinent, ₹900 for Middle East routes, ₹1,800 for South East Asia and China as well as Africa and West Asia, and ₹2,300 for Europe routes.
22 of the 27 analysts covering the stock have a 'Buy' rating, while three have 'Hold' ratings and two recommend 'Sell'.
Shares of InterGlobe Aviation settled 2.11% lower on Friday at ₹4,162. The stock has declined 19% so far in 2026.
