Interglobe Aviation Q2 FY27 Results Analysis: Loss Narrows 27%, FX Loss Weighs (INDIGO)

Interglobe Aviation Ltd's Q2 FY27 numbers came in soft. Here's a quick read of what worked, what to watch, and what management said.

Quarter Snapshot

Revenue grew 25.91% YoY to Rs.23,363.8 Cr on flattish guided capacity, with the PAT loss narrowing 27.2% YoY, but a Rs.1,333.2 Cr net FX loss and fuel at 42.67% of revenue kept the company loss-making at Rs.1,879.1 Cr. Ex-FX EBITDAR margin compressed to 19.75% from 26.06% YoY while equity fell 28.34% in H1 and net debt rose to Rs.35,253.2 Cr. Cost discipline and FCF of ~Rs.7,519.7 Cr are positives, but the FX line (~Rs.900 Cr PAT impact per Rs.1/USD per prior disclosures) remains the swing factor for FY27 profitability.

Key Investment Insights

Key Positives

• Revenue grew 25.91% YoY to Rs.23,363.8 Cr on flattish guided capacity, indicating yield-driven growth
• Reported EBITDAR margin improved to 14.04% from 10.48% YoY; PAT loss narrowed 27.2% YoY to Rs.1,879.1 Cr
• Fuel cost fell 8.00% QoQ and employee costs were flat QoQ (−0.25%), with non-fuel cost lines growing below revenue growth
• H1 operating cash flow of Rs.9,617.6 Cr vs H1 EBITDAR of Rs.8,118.7 Cr (CFO/EBITDAR ~1.18x); FCF ~Rs.7,519.7 Cr
• Proxy net debt/annualized H1 EBITDAR of 2.17x remains inside the CRISIL Watch-Developing trigger of >3.0x; cash and investments of Rs.52,049.9 Cr
• Subsidiaries contributed +Rs.178.7 Cr at PBT level in Q2 FY27, up from +Rs.143.5 Cr in Q1 FY27

Risk Factors

• Net FX loss of Rs.1,333.2 Cr (vs Rs.8.3 Cr in Q1 FY27) drove the QoQ loss widening to Rs.1,879.1 Cr from Rs.238.0 Cr
• Fuel expense rose 67.18% YoY to 42.67% of revenue from 32.13% a year ago
• Ex-FX EBITDAR margin compressed to 19.75% from 26.06% YoY
• Equity attributable to owners fell 28.34% in one half-year to Rs.4,995.3 Cr, now ~3.4% of total assets; net debt rose Rs.7,247 Cr in H1
• Total debt rose to Rs.87,303.1 Cr from Rs.77,749.2 Cr; H1 PAT loss of Rs.2,117.1 Cr vs Rs.405.8 Cr loss in H1 FY26