IndiGo, SpiceJet Shares Rally On August Domestic Aviation Traffic Data; Details

Shares of SpiceJet and InterGlobe Aviation (IndiGo) gained on September 16 after data released last week showed that competition among domestic airlines in India is heating.

The market share of Air India rose 40 basis points in August when compared to July as SpiceJet, and Akasa Air reported a 80 basis points, and 20 basis points fall in their respective market shares during the month.

In July, IndiGo had reported a 120 basis points jump in their market share when compared to June 2024. One basis point is one-hundredth of a percentage point.

At 9:35 am, IndiGo shares were trading a percent higher at Rs 4,964.45 on the National Stock Exchange (NSE). The stock has rallied 66 per cent so far this year, outperforming Nifty’s returns of 14 per cent.

In the past 12 months, IndiGo share price has zoomed 106 percent, more than doubling investors’ capital. In comparison, Nifty rose 28 percent during this period.

SpiceJet stock gained over 3 percent to trade around Rs 73.98 on BSE despite the air carrier hitting new lows in August with its market share shrinking by 80bps month-on-month (MoM) to 2.3 per cent, largely due to financial woes and increased grounding.

In the last one year, SpiceJet share price has surged around 94 percent, nearly doubling investors’ capital.

Overall, the country’s domestic air traffic in August rose 5.7 percent compared to the same month last year. The number climbed to 1.31 crore passengers, data released by the directorate general of civil aviation (DGCA) on September 13 showed.

Domestic air traffic fell in August, July and June when compared with May 2024’s reading, which stood at 1.38 crore passengers, 1.32 crore passengers had taken to the skies in June 2024, while 1.29 crore passengers had booked flights in July.

The passenger load factor, or the occupancy rate, of SpiceJet, Vistara, IndiGo, Air India, and AIX Connect stood at 81 per cent, 88.7 per cent, 82.3 per cent, 80.1 percent, and 84.4 per cent, respectively, in August.

Akasa Air’s passenger load factor came in at 85.5 per cent in August down from 86.4 percent in July, 89.6 percent in June, 90.3 per cent in May, 87.9 per cent in April, 88.4 per cent in March and 92.4 per cent in February. The airline completed two full year of operations on August 7, 2024.