InterGlobe stock to catch up: Premium valuation to continue, say analysts

Despite capacity issues and premium valuation, Street is postive on Indigo given its lower costs and strong balance sheet

The stock of InterGlobe Aviation, which operates the IndoGo airline, after lagging peers in the past, has gained 13 per cent in the last one month and  been hitting new 52-week highs recently. This is on expectation of strong double-digit growth in passenger traffic, gradual pick-up in capacity and improving yields, in line with the performance seen in the December 2017 quarter.

While demand is expected to be strong, the key factor for the Street is clarity on the resolution of the Pratt & Whitney (P&W) engine issues for the A320neo aircraft InterGlobe had procured; more of these are due