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IndiGo shares increase as investors shrug off record $2.45 Million fine

IndiGo shares rose up to 3.8% Monday, as investors shrugged off a $2.45m fine, which Jefferies analysts called a relatively modest penalty in light of the mass cancellations last month.

The airline cancelled 4,500 flights during the first weeks of December. This left tens and thousands of passengers stranded across the country, and highlighted concerns about the lack of competition in 'the fastest-growing aviation industry in the world.

Indigo's share price plummeted 14.2% in October, the steepest drop since?October 2020.

Jefferies stated in a report that "Fines look modest, probably?because of regulatory caps." "Focus shifts now to DGCA’s subsequent guidance on normalisation of schedules, once compliance milestones & systematic reforms have been independently validated."

The fine is equal to 0.31% of the annual profit for fiscal year 2025.

After a series of mass cancellations of flights last month, the Directorate General of Civil Aviation also?issued warnings and ordered India's largest airline? to remove its head of operations control from his position.

The regulator stated that a DGCA investigation found several deficiencies in the airline following the implementation of stricter 'pilot rest and duty' rules last year.

(source: Reuters)