Newsletter
IndiGo reported a steep rise in losses, but investors aren’t bailing out just yet. The stock gained 2% intraday.
By the numbers: the airline posted a net loss of ₹2,582 crore in Q2 FY26, nearly 3x higher YoY than ₹986.7 crore a year ago.
However, if you take out the impact of forex losses, the airline actually made a profit of ₹104 crore, turning things around from a ₹754 crore loss last year.
Revenue from operations rose 9.3% YoY to ₹18,555 crore, while total expenses climbed 18.3% to ₹22,081 crore, thanks to foreign exchange losses ballooning 12 times to ₹2,892 crore.
Forex losses simply mean the company lost money because the rupee became weaker against the Dollar, and many of its payments (like aircraft leases) are made in Dollars.
Foreign exchange refers to the conversion of one country’s currency into another, like exchanging Rupees for US Dollars when IndiGo pays for planes or fuel abroad.
Breaking it down: rising costs, a weak rupee, and higher aircraft leasing expenses weighed heavily on the bottom line.
Yet, brokerages like Motilal Oswal remain upbeat. The optimism stems from IndiGo’s aggressive capacity expansion plan, particularly in international routes, to hedge forex exposure and capture global demand.
Zoom out: India is now the third-largest domestic aviation market in the world, and passenger traffic is expected to touch 430 million by FY2030, nearly double the pre-pandemic levels.
Fuel prices and forex volatility remain challenges, but strong travel demand, expanding airports, and fleet growth are driving optimism. IndiGo alone commands about 60% of the domestic market, while new entrants like Akasa Air and the Tata Group’s Air India-Vistara merger are reshaping the skies.
