 "InterGlobe Aviation hits 17-month high")
Shares of Indigo-owner InterGlobe Aviation moved higher to its 17-month high of Rs 1,206, up 4.4% on the BSE in an otherwise subdued markets. The stock is trading at its highest level since January 2016.
SpiceJet and Jet Airways (India) also gained in the range of 2% to 3%, following slide in crude prices.
Lower crude oil prices benefit aviation companies as jet fuel constitutes over 40% of an airline's operating costs.
Thus far in the calendar year 2017, SpiceJet (up 121%), Jet Airways (up 58%) and InterGlobe Aviation (46%) have outperformed the Sensex, which gain 17%.
Meanwhile, according to JP Morgan, Goods and Service Tax (GST) rate of 5% on airline tickets is 100bps lower than the previous service tax, which is a positive, given industry fears of a potential 12% tax slab earlier. Business class tickets are to be taxed at 12%.
Indigo improved its market share to 41.4% in April with domestic traffic increasing 23% Y/Y. Domestic load factor was 87% in April. The airline plans to increase capacity by 25% in FY18; and is thus likely to gain additional market share, added report.
SpiceJet and Jet Airways (India) also gained in the range of 2% to 3%, following slide in crude prices.
Lower crude oil prices benefit aviation companies as jet fuel constitutes over 40% of an airline's operating costs.
Thus far in the calendar year 2017, SpiceJet (up 121%), Jet Airways (up 58%) and InterGlobe Aviation (46%) have outperformed the Sensex, which gain 17%.
Meanwhile, according to JP Morgan, Goods and Service Tax (GST) rate of 5% on airline tickets is 100bps lower than the previous service tax, which is a positive, given industry fears of a potential 12% tax slab earlier. Business class tickets are to be taxed at 12%.
Indigo improved its market share to 41.4% in April with domestic traffic increasing 23% Y/Y. Domestic load factor was 87% in April. The airline plans to increase capacity by 25% in FY18; and is thus likely to gain additional market share, added report.
One subscription. Two world-class reads.
Already subscribed? Log in
Subscribe to read the full story →*Subscribe to Business Standard digital and get complimentary access to The New York Times
Smart Quarterly
₹900
3 Months
₹300/Month
SAVE 25%
Smart Essential
₹2,700
1 Year
₹225/Month
SAVE 46%
*Complimentary New York Times access for the 2nd year will be given after 12 months
Super Saver
₹3,900
2 Years
₹162/Month
Subscribe
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Exclusive premium stories online
Over 30 premium stories daily, handpicked by our editors
Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share
Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor
Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements
Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app
SAVE 25%