IndiGo to pay ₹20-lakh penalty over 4 tail strikes in 2023

Airline major IndiGo parent InterGlobe Aviation Ltd has been fined ₹20 lakh by the aviation regulator DGCA (Directorate General of Civil Aviation) over four tail strike incidents in 2023. 

IndiGo had received a show cause notice dated July 3, 2023, alleging four tail strike incidents on A321 aircraft within six months in 2023 to which it filed its response on July 17, 2023. Thereafter, DGCA issued an order dated July 28, 2023, imposing a penalty of ₹30 lakh.

IndiGo says after its appeal against the said DGCA order, the penalty was reduced to ₹20 lakh. "DGCA considered submissions made by the Company in support of the Appeal and revised the penalty to INR 20 Lakhs vide its Order dated October 13, 2023, to be paid within 30 days of the Order. Accordingly, the penalty was paid on November 9, 2023," IndiGo says via an exchange filing.

IndiGo clarified the penalty will have no material impact on the financials, operations or other activities of the company. 

In terms of share price, IndiGo shares opened in green on the BSE today and surged to an intra-day high of ₹2,906.65, up 0.8% as compared to the previous session close. At the current share price of ₹2,899.95, the share is trading down 3.5% compared to the 52-week high of ₹3,006.9 touched on December 13, 2023. 

IndiGo this week achieved a new milestone as the budget carrier became the first Indian airline to carry 100 million passengers in a calendar year.

The airline celebrated its 17th anniversary this year, and claims to have become one of the fastest airlines to reach the 100 million passenger figure. 

In the calendar year 2022, the airline says it flew 78 million passengers on board (slightly above pre-COVID-19 levels). The new milestone represents a 22% increase in passenger traffic for 2023.

The company in June this year placed the largest-ever single aircraft order in the aviation history after it said it'll buy 500 Airbus A320 planes. The order will provide IndiGo with a further steady stream of deliveries between 2030 and 2035.

IndiGo operates over 300 aircraft and has previous orders totalling 480 aircraft, which are yet to be delivered. With this additional order of 500 aircraft for 2030-2035, IndiGo's order book has almost 1,000 aircraft yet to be delivered well into the next decade. The airline's domestic market share stood at 60.3% in November 2023.

The airline reported a net profit of ₹188.9 crore for the July-September quarter of 2023-24 as compared to a net loss of ₹1,583.3 crore in the year-ago period.

In Q2 FY24, which is considered the seasonally weakest quarter, IndiGo’s profit excluding foreign exchange loss, was ₹806 crore. The company’s total revenue stood at ₹15,502.9 crore, an increase of 20.6% over the same period last year. Its passenger ticket revenue was ₹13,069 crore, an increase of 17.6% and ancillary revenue surged 20.05% to ₹1,551 crore.