STRATEGY MANAGEMENT

REPORT ON:

COMMERCIAL AVIATION INDUSTRY -

INDIGO

Submitted To:

Prof. Shantam Shukla

Submitted By:
Vanshika Arora, PGP39447
Varnika Kedia, PGP39446
Shrey Jain, PGP39435
Newcy Sancheti, PGP39418
Anikesh Kumar Singh, PGP39403
Amar Deep Ekka, PGP39402
 CONTENT

EXECUTIVE SUMMARY ................................................................................................................................. 2

OVERVIEW OF KEY FINDINGS .................................................................................................................... 2
RECOMMENDATIONS ................................................................................................................................ 2
INTRODUCTION ............................................................................................................................................ 2
PURPOSE OF THE REPORT ......................................................................................................................... 2
OVERVIEW OF THE COMMERCIAL AVIATION INDUSTRY ........................................................................... 3
RATIONALE FOR SELECTING INDIGO ......................................................................................................... 3
INDUSTRY ANALYSIS ..................................................................................................................................... 4
MARKET OVERVIEW .................................................................................................................................. 4
PORTER'S FIVE FORCES ANALYSIS.............................................................................................................. 6
CHALLENGES AND PROBLEMS .................................................................................................................. 8
COMPANY ANALYSIS..................................................................................................................................... 9
OVERVIEW ................................................................................................................................................. 9
STRATEGIES ............................................................................................................................................. 10
SWOT ANALYSIS....................................................................................................................................... 12
VRIO ANALYSIS ........................................................................................................................................ 12
COMPETITIVE ADVANTAGE ANALYSIS ..................................................................................................... 13
RECOMMENDATIONS ................................................................................................................................. 17
FOR INDIGO ............................................................................................................................................. 17
FOR GOVERNMENT ................................................................................................................................. 18
REFERENCES ................................................................................................................................................ 18

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 EXECUTIVE SUMMARY
OVERVIEW OF KEY FINDINGS

The report thoroughly explores the commercial aviation industry with a focus on IndiGo, detailing
its competitive positioning and strategy within the rapidly evolving sector. Key findings highlight
IndiGo's dominance in the Indian aviation market, operational excellence, and strategic focus on
cost efficiency and customer satisfaction. Additionally, it addresses broader industry trends,
including the rapid expansion of the aviation sector, driven by increasing demand and
technological advancements, while also noting significant challenges such as fuel price volatility
and regulatory hurdles.

RECOMMENDATIONS

To bolster IndiGo's market dominance and foster the overall growth of the aviation sector, our
recommendations converge on enhancing customer service, optimizing cost efficiency, and
pursuing strategic expansion. IndiGo should focus on refining customer experiences through
superior service delivery and robust complaint resolution mechanisms, while also leveraging
technological advancements to streamline operations and engage customers more effectively.
Strategic fleet expansion with an emphasis on fuel-efficient aircraft will not only support
IndiGo's sustainable growth ambitions but also align with environmental sustainability goals.
Expanding international routes and forming strategic alliances will enable IndiGo to capitalize on
its domestic market strength and broaden its global footprint. For the government, simplifying
regulatory frameworks, incentivizing sustainable aviation practices, improving regional
connectivity, and advocating for carbon offsetting initiatives are critical steps to facilitate
industry growth and environmental stewardship.

INTRODUCTION
PURPOSE OF THE REPORT

This report aims to thoroughly examine the commercial aviation industry, focusing on its
attractiveness, challenges, and opportunities. It will analyze the various factors influencing the
industry's competitiveness and highlight the key challenges it faces today, as well as the emerging
opportunities expected to shape its future.
Moreover, the report will conduct a detailed analysis of IndiGo, a prominent player in the
commercial aviation sector. By scrutinizing IndiGo's business and corporate strategies, as well as
its key resources, capabilities, and core competencies, it seeks to uncover the factors contributing
to its competitive advantage over its rivals.

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 Based on the insights gained from the industry analysis and IndiGo's strategic examination,
actionable recommendations and suggestions will be provided for IndiGo to enhance its
competitive position in the short-term and medium-term.
Lastly, the report will offer recommendations to the government on potential policy changes that
could positively impact the commercial aviation industry and benefit companies like IndiGo.
These recommendations will aim to create a regulatory environment conducive to industry
growth and innovation.

OVERVIEW OF THE COMMERCIAL AVIATION INDUSTRY

• India's commercial aviation segment is the largest for aircraft deliveries and India ranks as the
third-largest domestic aviation market globally.
• Predicted to surpass the UK to become the third-largest air passenger market by 2024.
• Aviation contributes 5% to India's GDP and generates 4 million jobs.
• The industry adds USD 72 billion in gross value-added contribution to GDP.
• Expected increase in the air fleet from 600 to 1,200 by 2024
• In FY23, airports in India pegged the domestic passenger traffic to reach 270.34 million, a 62.1%
YoY increase, and international passenger traffic to reach 56.9 million, a 157% YoY increase, as
compared to FY22
• Freight traffic at Indian airports grew at a CAGR of 2.20% from FY16 to FY23, from 2.70 MMT to
3.15 MMT.
• To manage rising air traffic, India aims to expand its number of operational airports from 148 in
2023 to 220 by 2025.

RATIONALE FOR SELECTING INDIGO

IndiGo continues to be India’s

largest passenger airline. The
company primarily operates in
India’s domestic air travel market as
a low-cost carrier with a focus on
three pillars – offering low fares,
being on time, and delivering a
courteous and hassle-free
experience. IndiGo has become
synonymous with being on time.

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 Market Dominance
• IndiGo holds a significant 60.5 % market share in the Indian domestic aviation sector,
positioning itself as a crucial player for examination. Its dominance in both domestic and
international operations make it a pertinent subject for analysis.
Operational Excellence
• Renowned for streamlined operations and a cost-efficient business model, IndiGo
consistently demonstrates profitability amidst fierce competition. Examining its operational
strategies provides valuable insights into achieving efficiency in aviation.

Strategic Positioning
• IndiGo strategically positions itself as a leading low-cost carrier, appealing primarily to
budget-conscious travelers. Understanding how it maintains this positioning amid market
shifts and evolving consumer preferences is pivotal for understanding its competitive edge.

Challenges and Opportunities

• IndiGo faces industry-specific challenges such as fuel prices, infrastructure limitations, and
competition. Identifying these challenges helps understand its resilience, while recognizing
growth opportunities is crucial for future prospects.
Industry Influence
• As a major player in commercial aviation, IndiGo's decisions and strategies often set trends
and influence industry dynamics. Studying IndiGo's approach provides insights into broader
industry trends and future developments.

INDUSTRY ANALYSIS
MARKET OVERVIEW

Global Aviation Industry

Market Size: The Commercial

Aviation Market size is
estimated at 198.72 billion
USD in 2024, and is expected to
reach 293.59 billion USD by
2030, growing at a CAGR of
6.72% during the forecast
period (2024-2030).

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 Growth Trends:

• Asia-Pacific Leads Recovery: The Asia-Pacific region saw a 10% surge in air passenger traffic in
2022, totaling 2.2 billion passengers, showcasing strong recovery and pent-up demand post-
pandemic.
• Fleet Expansion Plans: Airlines in major countries like China, India, Japan, and Indonesia,
representing 70% of the region's air traffic, are actively expanding fleets to meet rising demand
for air travel.
• Improvements in Passenger Load Factors: The Asia-Pacific region achieved a notable 17.9
percentage point increase in passenger load factors, reaching a robust 78.8%, indicating
efficient capacity utilization by airlines.

Indian Aviation Industry

Market Size: The aviation industry in India has emerged as one of the fastest-growing industries
in the country during the last three years. Domestic traffic contributes around 69% of the total
airline traffic in South Asia and India’s airport capacity is expected to handle 1 billion trips
annually by 2023. The air traffic movement stood at 327.28 million in FY23 compared to 188.89
million in FY22.
Indigo is the largest airline company in India with the highest market share. India has become
the third-largest domestic aviation market in the world and is expected to overtake the UK to
become the third-largest air passenger market by 2024.

Growth Trends:

• Rising Passenger Numbers:

Total domestic passengers - 60 million in 2014 to 143 million in 2020
Total international passengers - 43 million to 64 million during the same period. This indicates
a robust upward trend in air travel demand.
• Aircraft Fleet Expansion: The number of aircraft in India has increased steadily, from around
400 in 2014 to 723 in 2023. This aircraft fleet expansion reflects the growing demand for air
travel.
• Airport Infrastructure Development: The government's ambitious plan to develop 100 airports
by 2024 under the UDAN Scheme is aimed at further enhancing the capacity of airport
infrastructure to meet the growing demand for air travel.
• UDAN Scheme: The UDAN (Ude Desh ka Aam Nagrik) Scheme has played a crucial role in
increasing regional connectivity and making air travel more accessible to a wider population.
With over 76 airports developed and more than 2.15 lakh UDAN flights operated, the scheme has
facilitated over 11 million passengers to date.

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• MRO Services: The projected upsurge in air travel is expected to drive the demand for
Maintenance, Repair & Overhaul (MRO) services in India. The Indian Civil Aviation MRO market
is poised to grow from $900 million to $4.33 billion by 2025.

PORTER'S FIVE FORCES ANALYSIS

1. Threat of New Entrants (LOW-

MEDIUM)

a) Barriers to Entry:
High capital requirements: for aircraft,
infrastructure (airports, hangars), landing
slots at congested airports, and obtaining
operating licenses create significant
barriers.
Landing Slots: Securing landing slots at
congested airports, especially major hubs, is challenging. Established airlines often have
preferential access, leaving limited slots for new entrants.
Operating Licenses: Obtaining the necessary operating licenses and permits involves navigating
complex regulatory frameworks, which can be time-consuming and costly.
b) Brand Recognition: Established airlines have strong brand loyalty and recognition, making it
difficult for new entrants to gain market share.
Customer Loyalty: Passengers develop trust and familiarity with established airlines, leading to
repeat business and positive word-of-mouth recommendations.
Positive Brand Associations: Strong brands are associated with certain qualities, like safety,
reliability, comfort, or a particular travel experience.
c) Government Regulations:

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India's aviation market is heavily regulated, making it challenging for new airlines to enter. For
example, the Directorate General of Civil Aviation (DGCA) has stringent safety regulations that
new airlines must comply with to obtain an operating license. Additionally, bilateral air traffic
agreements limit the number of flights that foreign airlines can operate to and from India,
restricting market access for new entrants.
2. Bargaining Power of Suppliers (HIGH)
a) Aircraft Manufacturers:
Duopoly Market: Airbus and Boeing dominate the large commercial aircraft market (over 100
seats) with a market share exceeding 90%. This lack of competition gives them significant leverage
in negotiations with airlines.
Order Backlogs: Both Airbus and Boeing maintain large order backlogs, meaning airlines need to
wait years for new aircraft deliveries, limiting their ability to pressure for lower prices. In 2023,
Airbus had an order backlog of over 7,000 aircraft, while Boeing had over 4,000.
b) Fuel Suppliers:
Fragmented Market: Unlike the duopoly in aircraft manufacturing, the jet fuel market has
multiple suppliers, including major oil companies and independent refiners. This fragmentation
gives airlines some leverage in negotiations.
Limited Control over Price: Jet fuel prices are primarily driven by global oil prices, which are
influenced by various factors beyond the control of airlines.
3. Bargaining Power of Buyers (MEDIUM)
a) Price Sensitivity:
According to a study by IATA (International Air Transport Association), the price sensitivity of
passengers varies depending on the type of travel. For example, leisure travelers are more price-
sensitive compared to business travelers.
b) Travel Aggregators:
Online travel agencies (OTAs) play a significant role in aggregating flight options and facilitating
price comparison. OTAs have empowered customers by offering transparency and convenience
in booking flights, leading to increased price sensitivity as customers can easily compare prices
across different airlines and make informed decisions.
c) Business vs. Leisure Travel:
Business travelers are generally less price-sensitive compared to leisure travelers. They often
prioritize factors such as schedule flexibility, loyalty programs, and premium services over price.
On the other hand, leisure travelers have a wider range of options, including budget airlines,
alternative travel methods (e.g., trains, buses), and vacation packages. This increased choice

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makes leisure travelers more price-sensitive, especially when planning trips that are more
discretionary in nature.
4. Threat of Substitute Products or Services (LOW-MEDIUM)
a) Video Conferencing and Telecommunication:
Reduced Business Travel: Advancements in video conferencing technology have facilitated
remote communication, potentially reducing the need for some business travel, particularly short
business trips for meetings or conferences.
b) High-Speed Rail and Road Transport:
High-speed rail networks can be a significant competitor for airlines on short-haul routes (typically
under 500 km).
5. Rivalry among Existing Competitors (HIGH)
a) Fragmented Market:
The global airline industry is highly fragmented, with numerous airlines competing on various
routes. This fragmentation leads to intense competition on price, service offerings, and route
networks as airlines strive to attract passengers and gain market share.
b) Hub-and-Spoke vs. Point-to-Point Models:
Legacy carriers like Delta Air Lines and United Airlines operate hub-and-spoke models, using
major hubs like Atlanta and Chicago to connect passengers to various destinations. In contrast,
low-cost carriers like Southwest Airlines and JetBlue Airways primarily operate point-to-point
services, offering direct flights between select cities.
c) Strategic Alliances:
Airlines form strategic alliances, such as Star Alliance and Oneworld, to offer passengers a wider
network of destinations and benefits, such as shared frequent flyer programs and seamless
connections. While these alliances benefit passengers, they also reduce competition on some
routes as member airlines coordinate schedules and pricing.

CHALLENGES AND PROBLEMS

1. Fuel Price Volatility:

Significant Cost Factor: Jet fuel constitutes 20-25% of airlines' total costs.
Impact on Profitability: Fluctuations in fuel prices can heavily impact airline profitability,
necessitating fare adjustments or cost-cutting measures.

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 2022 vs. 2023: Average jet fuel prices rose from
$80 to over $120 per barrel in 2023 due to global
events like the Russia-Ukraine conflict, posing
challenges to airline profitability.
2. Regulatory Challenges:
Safety Regulations: Stringent safety regulations,
such as new pilot training requirements, can
increase operational complexity and costs for
airlines.
Slot Restrictions: Limited landing slots at congested airports, like London Heathrow, can hinder
network expansion and incur high costs for airlines.
3. Technology Disruptions:
Autonomous Aircraft: Emerging technologies like autonomous passenger aircraft could disrupt
traditional aviation operations and impact pilot employment.
Urban Air Mobility (UAM): Electric vertical take-off and landing (eVTOL) aircraft pose a potential
threat to short-haul flights, potentially altering travel patterns within urban areas.

4. Environmental Concerns:

Carbon Emissions: Air travel contributes significantly to

CO2 emissions, accounting for 2.4% of global emissions
in 2020.
Public Pressure: Growing environmental concerns
pressure airlines to invest in cleaner technologies and
offset carbon emissions.

COMPANY ANALYSIS
OVERVIEW

IndiGo is India’s largest passenger airline, known for its low-cost offerings and significant
market presence.

History:

• Founded: 2006 by Rakesh Gangwal and Rahul Bhatia

• First Flight: 2006, from New Delhi to Imphal via Guwahati
• Fleet Growth: From 6 aircraft in 2006 to over 320 as of recent reports
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• Market Milestone: Became India’s largest airline by market share in 2012

Market Size:

• Domestic Market Share: 60.5% as of

2023
• Global Ranking: 6th in terms of market
capitalization, surpassing United Airlines
with a valuation of $13.8 billion

Mission and Vision:

• Mission: To connect the vast and diverse

India, supporting social cohesion, mobility, and economic progress.
• Vision: IndiGo aims to extend its scope internationally, transitioning from a domestic carrier to
a global aviation giant.
IndiGo’s commitment to affordable fares, punctuality, and a hassle-free travel experience has
positioned it as a preferred choice among passengers, both domestically and internationally.
The airline’s focus on sustainability and reducing its carbon footprint further underscores its
forward-thinking approach.

STRATEGIES

Business Strategy

• Short-haul routes: IndiGo primarily concentrates on point-to-point routes and providing

single-class seating. By avoiding the complexities and costs associated with hub-and-spoke
operations, IndiGo can offer direct flights between popular destinations, appealing to both
leisure and business travelers.
• Bulk purchase strategy: IndiGo's low aircraft acquisition costs are a result of buying aircraft in
large quantities. In October 2019, it announced an order for 300 A320 Airbus aircraft, one of
the largest purchases ever placed by a single airline operator.
• Modern Fleet: The airline invests in a modern and fuel-efficient fleet of aircraft, primarily
consisting of Airbus A320 family jets, which helps to reduce fuel consumption, maintenance
costs, and emissions, contributing to both cost savings and environmental sustainability.
• Single aircraft model: IndiGo achieves excellent efficiency by adopting a single aircraft model
to provide frequent, reliable flights, while lowering their overall maintenance cost.
• Sale-and-leaseback financial model: These transactions account for the majority of IndiGo's
income.

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 Corporate Strategy

• Market Expansion: IndiGo continuously adds new routes and increases flight frequencies to
capture a larger share of the Indian aviation market and strengthen its competitive position.
• Customer Focus: IndiGo prioritizes passenger needs and preferences to build long-term
relationships, enhance brand reputation, and ensure maximum customer satisfaction and
loyalty. This includes offering a seamless booking experience, reliable service, and competitive
fares.
• Partnerships and Alliances: IndiGo forms strategic alliances with companies in the travel and
tourism industry, such as hotels and car rental agencies, to offer integrated travel solutions
and expand revenue streams beyond ticket sales.

Resulting Strategic Fit

• Establishing Operational Synergy: With a 20-minute turnaround time, Indigo has very high on-
ground efficiency. It has accomplished this by implementing a few strategies, such as defining
tasks for each minute, whether it is during the arrival or departure of the flight. This strict
schedule helps to precisely define each person's function and promotes increased productivity.
In addition to the standard pre-flight briefings, Indigo offers post-flight briefings too. This is a
kaizen approach for exploring how to enhance overall operations even further. Indigo keeps
practically every aircraft in the air for an average of 12 hours each day as a result of these
procedures.
• Creating Financial Synergy: Indigo has maintained a strong financial control structure, which
aids in the effective management of working capital. A decreased turnaround time of 20
minutes resulting from its efforts to achieve operational efficiency, improves per-flight
utilization capacity and helps maintain the flight on schedule. This alignment of activities also
significantly lowers costs.
• Leasing Strategy: IndiGo utilizes the sale and leaseback (SLB) model, allowing it to purchase
aircraft at favorable prices, sell them to lessors, and then lease them back. This approach
generates revenue, provides fleet flexibility, saves on depreciation, boosts earnings, and
reduces taxes. SLBs enable IndiGo to maintain a minimal debt load while focusing on its core
operations. Its marketing strategy fosters strong ties with leasing businesses, facilitating the
flexibility of the sale-and-leaseback model.
• Sustainability Initiatives: IndiGo invests in next-generation aircraft, reducing its CO2 footprint
by approximately 20% compared to seven years ago. About 80% of its fleet consists of new-
generation aircraft, making it one of the world's lowest CO2 emitting airlines. Sustainability
measures are integrated into operations, including single engine taxiing, use of electric ground
vehicles, electronic flight bags, and water conservation measures on-board.

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SWOT ANALYSIS

STRENGTHS
• Largest airline in India by market share,
with a robust domestic network.
• Low-cost carrier model, with competitive
fares and lower operating expenses
• Operational efficiency, with high aircraft
utilization rates, quick turnaround times,
and a lean organizational structure
• Brand Awareness and strong brand
reputation
OPPORTUNITIES
• Growing Global Travel and Tourism (T&T)
Industry
• International Expansion
WEAKNESS
• Overreliance on Domestic Market
• Fuel Price Sensitivity
• Need improvement on customer services
• Substantial debt may weaken its financial
position
THREATS
• Intense Competition
• Change in regulatory policies and Airline
Security Measures
• Labor Disputes and Strikes

VRIO ANALYSIS

Valuable:
• IndiGo's lean operational model, which focuses on low-cost travel and high aircraft
utilization, is extremely valuable. Its large market share and extensive domestic network
also provide significant value.
Rare:
• IndiGo's strategy of maintaining a single type of aircraft (Airbus A320 family) for the
majority of its fleet is somewhat rare in the industry and contributes to reduced training
and maintenance costs.
Inimitable:
• The brand's reputation for punctuality and affordability is difficult for competitors to
imitate quickly. Over the years, IndiGo consistently maintained the highest average OTP
across four key metro cities: Bangalore, Delhi, Hyderabad, and Mumbai.
Organized to Capture Value:
• The company demonstrates efficient resource utilization through streamlined
operations and strategic route planning. IndiGo's adoption of a point-to-point model
facilitates direct passenger connections between cities, without the complexity of
layovers or hub-and-spoke systems. With extensive connectivity and penetration in tier
2 and tier 3 cities, its expanded network caters to a broader demographic, improving air
travel accessibility across India.

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COMPETITIVE ADVANTAGE ANALYSIS

Domestic market share of airlines across India in financial year 2023, by passengers carried: With
a visible growth trend, it was
estimated that by 2034, India
would become one of the largest
aviation markets in the world. As
of financial year 2023, the
passenger carrier IndiGo was the
leader in the segment with
around 54.7 percent in the
market. Indigo airline’s low cost
and no-frills approach to
domestic flying had been cited as
one of the factors leading to its
relative success in India.
According to the Directorate-
General of Civil Aviation, IndiGo airline carried over 46.6 million passengers during the fiscal year
2022. It ranked fourth among the country’s most punctual airlines with almost 84 percent on-
time arrivals. As a carrier that also had the least complaints from the customer, IndiGo’s
popularity with the domestic base was high, soaring towards growth in the years to come.

Metrics / Airlines SpiceJet Ltd Air India Ltd IndiGo

Flag carrier with wide Low-cost leader with a
Low-cost carrier
international and focus on operational
Market Position & with emphasis on
domestic reach, efficiency, customer
Strategy expanding flight
focused on fleet experience, and
services and fleet
expansion aggressive fleet growth
Wide and narrow
88 aircraft (Q400, body (A319, A320, 304 aircraft (A320 NEO,
Boeing 737-700s, A320neo, A321, A321 NEO, A320 CEO,
Fleet Size & Type
737-800s, 737- A321neo, B787-8, ATR, A321 freighter,
900ERs, Max) B777-200LR, B777- Boeing 777)
300ER)
Domestic and
international 102 international and
(Dubai, Kabul, domestic destinations
78 domestic and 26
Muscat, Bangkok, in Asia-Pacific,
Operational Reach international
Male, Colombo, Europe, Africa,
destinations
Hong Kong, Middle East, North
Riyadh, Jeddah, America
Dhaka)

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 Expansion of flight Fleet expansion with
services, fleet significant Boeing and Focus on on-time
addition, Airbus orders, merger performance, customer
partnership with initiatives with satisfaction, digital
Strategic Initiatives
Clever Tap for Vistara, focus on enhancements, fleet
improved digital and expansion, and
customer operational international growth
experience improvements
Need for strategic
Operational overhaul under Tata Maintaining market
losses, need to ownership, leadership amid growing
Key Challenges improve financial integration challenges competition, managing
health and market with mergers, large-scale operations
share improving operational efficiently
efficiency
Focus on recovery
Revitalization under Continued dominance in
and strategic
Tata leadership with the domestic market
growth through
Future Outlook fleet expansion and with plans for
fleet expansion
improved service international expansion
and service
quality and fleet growth
enhancement

Conclusion: Overall, IndiGo emerges as the leader in terms of revenue, fleet size, domestic
network, and strategic focus on on-time performance and cost management. However, Air
India's recent acquisitions and partnerships indicate efforts to stay competitive, while SpiceJet is
also expanding its services and partnerships to improve its market position.

Financial Comparison: Primary Competitor Analysis: Indigo Vs SpiceJet

KPI SpiceJet IndiGo

Profit After Tax (FY2022) (in millions of INR) -15,030 -92.6
Passenger Load Factor (YoY%) 7.20% 8.50%
Available Seat Kilometers (YoY%) Inc. by 39% Inc. by 62%
Revenue Available Seat Kilometers (YoY%) Inc. by 30% Inc. by 29%
Operating Margin (FY2023) 16% 13.40%
Net Profit Margin (FY2023) -15% -0.60%
EPS -24.97 -8.22
Debt to Equity Ratio -2.27 -6.16

Note: For Indigo Cost per Available Seat Kilometer (CASK): CASK increased by 5.0% from Rs. 4.60 in FY 2022 to Rs. 4.83 in FY
2023, primarily driven by increase in fuel cost and foreign exchange, offset by higher capacity deployment

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 Performance Analysis Over the Years

1. Number of passengers transported by IndiGo from financial year 2014 to 2023 (in millions):
India’s leading low-cost air carrier, IndiGo, carried around 85.27 million domestic and
international passengers in the financial year 2023. This was an increasing number as compared
to about 46.7 million in the fiscal year 2022.

2. Load factor of InterGlobe Aviation Limited from financial year 2018 to 2023: In financial year
2023, IndiGo's load factor reached just above 82 percent, 8.5 percent higher than the previous
year. In 2018, load factor of IndiGo reached its peak at 87.4 percent. From 2018 to 2020, it
remained stable and significantly declined in fiscal year 2021.

3. Number of passenger aircrafts of InterGlobe Aviation Limited in financial year 2023, by type:
In financial year 2023, out of all aircraft types of IndiGo, the number of Airbus A320 NEO was
the highest at 162. The passenger aircraft fleet of IndiGo consisted of ATR, A320 NEO, A320

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 CEO, and A321 NEO. The company had a plan to expand its fleet by ordering more aircraft,
especially Airbus Xtra Long Range for long-haul flights.

4. Fleet size of InterGlobe Aviation Limited from financial year 2018 to 2023: In financial year
2023, there were 304 aircraft in IndiGo's fleet. In fiscal year 2022, the fleet size declined and stood
at 275. In the future, the company plans to order more aircraft such as Airbus Xtra Long Range XLR
aircraft.

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 RECOMMENDATIONS
FOR INDIGO

Short Term:

• Enhance Customer Experience:

Customer Service Improvement: Implement proactive measures to enhance passenger
satisfaction, including personalized services, streamlined check-in processes, and attentive
customer support.
Complaint Resolution: Establish robust mechanisms for addressing passenger complaints
promptly and effectively. This may involve dedicated customer service channels, feedback
mechanisms, and employee training programs to address issues promptly.
• Cost Efficiency Measures:
Fuel Consumption Optimization: Implement fuel-efficient practices and technologies to
minimize fuel consumption, such as route optimization, and operational efficiency
improvements.
Ground Handling Optimization: Streamline ground handling processes to reduce costs
associated with aircraft turnaround times, airport fees, and other ground services. This may
involve outsourcing non-core functions, implementing automation, and negotiating favorable
contracts with service providers.
• Route Management:
Operational Flexibility: Maintain agility in route management to respond quickly to market
changes and competitive pressures. This may involve deploying aircraft strategically or
adjusting frequencies, or exploring new destinations.

Medium Term:

• Fleet Expansion: Expand the fleet strategically to meet rising demand, focusing on fuel-
efficient aircraft to enhance operational efficiency and reduce environmental impact.
• International Expansion: Explore new international routes to high-traffic destinations,
leveraging IndiGo's strong domestic network and reputation for operational excellence to
capture market share in key international markets.
• Alliances and Partnerships: Pursue alliances and partnerships with other airlines or join global
alliances to expand code-sharing agreements and network connectivity, enabling IndiGo to
offer seamless travel options and enhance its global reach.
• Digital Transformation: Invest in digital technologies to streamline booking processes,
enhance check-in procedures, and improve customer engagement. This includes developing

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 user-friendly mobile apps, implementing self-service kiosks, and leveraging data analytics for
personalized customer experiences.

FOR GOVERNMENT

Policy Recommendations:

• Simplify Regulatory Processes: Streamline approval procedures for aviation projects to cut
down on bureaucratic delays, making operations smoother and more cost-effective for airlines.
• Encourage Private Investment: Offer tax incentives and subsidies to attract private investment
in airport infrastructure and research initiatives, fostering growth and innovation in the sector.
• Boost Regional Connectivity: Enhance support for regional airlines operating in remote areas,
improve regional airport infrastructure, and enhance connectivity to underserved regions to
promote economic development.

Support for Sustainable Practices:

• Promote Sustainable Aviation Fuels: Provide incentives for airlines to adopt sustainable
aviation fuels, ensuring an eco-friendlier approach to air travel.
• Invest in Green Infrastructure: Allocate funds for the development of eco-friendly airport
infrastructure, including electric vehicle fleets and energy-efficient terminals, reducing carbon
emissions and environmental impact.
• Implement Carbon Offsetting: Introduce programs to offset carbon emissions from flights,
encouraging airlines to reduce their environmental footprint and contribute to sustainability
efforts.

REFERENCES

https://www.mordorintelligence.com/industry-reports/commercial-aircraft-market

https://www.investindia.gov.in/sector/aviation https://www.ibef.org/industry/indian-aviation

https://www.ibef.org/industry/indian-aviation

https://economictimes.indiatimes.com/markets/expert-view/why-indigo-has-been-a-stand-out-
performer-in-the-aviation-sector-pieter-elbers-answers/articleshow/101037498.cms?from=mdr

https://www.business-standard.com/companies/news/indigo-should-be-compared-with-global-carriers-
not-domestic-ceo-elbers-123092600673_1.html

https://www.goindigo.in/

https://www.cnbctv18.com/aviation/why-sale-and-leaseback-is-the-centerpiece-of-indigos-airbus-
300massive-aircraft-orders-4617661.htm
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