Indigo's rise despite stake sale by Gangwal family?

Shares of InterGlobe Aviation, the parent company of IndiGo, fell by 2.75 percent on June 12 as news of the Gangwal family offloading their stake in the company emerged. However, the stock price has remained stable and is up 17 percent this year. IndiGo reported a second consecutive quarterly profit of Rs 919 crore in the quarter ended March 2023.

Analysts are optimistic about the stock, citing stable crude prices and positive prospects for international air travel. IndiGo has announced an expansion to six new international destinations starting in July. The airline's market share has been increasing, while competitors like SpiceJet and Go First have experienced declines. Analysts believe that the duopolistic structure of the industry, with IndiGo and Air India as dominant players, bodes well for the stock.

Domestic passenger traffic has shown strong growth, reaching close to pre-Covid levels. IndiGo's yields have also increased, and analysts expect them to rise further with capacity expansion and the introduction of more fuel-efficient aircraft.

However, uncertainties such as fuel costs and crude oil prices remain a concern. From a technical perspective, analysts suggest that the stock may consolidate and retrace before further rallies. Investors are advised to consult certified experts before making any investment decisions.