INDIGO - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

📊 Investment Analysis: InterGlobe Aviation Ltd. (INDIGO)

Investment Rating: 4.4

✈️ Fundamental Outlook

ROE: 103% and ROCE: 17.3% — jaw-droppingly strong ROE due to high asset turnover and margin expansion; ROCE is solid.

EPS: ₹188 vs. P/E of 38.2 — reasonable given high profitability and sector leadership.

PEG Ratio: 0.89 — favorable value, suggests growth is slightly underpriced.

Debt-to-Equity: 7.13 — very high leverage; typical for airline business, but a key risk area.

Dividend Yield: 0.17% — minimal payout; focus clearly on reinvestment and expansion.

📌 The numbers reflect stellar bottom-line growth, robust operating metrics, and bullish institutional activity.

📉 Technical & Price Trend Snapshot

RSI: 48.5 — neutral; no immediate breakout or breakdown.

MACD: 46.7 — strong bullish momentum; signaling upward trend continuation.

Above 50 & 200 DMA — confirms sustained technical strength.

52W Performance: +88.2% — phenomenal rally; may prompt caution for fresh entry.

🎯 Ideal Entry Price Zone: ₹5,300 – ₹5,500 A retest toward 50 DMA (₹5,655) or support near ₹5,300 offers better margin of safety for fresh investors.

🧭 Holding / Exit Strategy

✅ Hold Strategy

Holding Period: 3–5 years

Continue holding if

ROE remains above 30% in future quarters

EPS trends toward ₹225+ in the next 6–8 quarters

Debt ratio drops below 5.0 with strong cash flow management

Market cap expands beyond ₹2.5L Cr. on back of route expansion and demand surge

🚪 Exit Strategy

Partial Exit: Near ₹6,000+ — lock gains if valuation outpaces growth

Full Exit If

EPS stagnates below ₹175 over 3–4 quarters

Debt servicing strains margins or ROCE falls below 13%

Price breaks below ₹5,000 with weakening RSI and MACD reversal

INDIGO is a prime candidate for long-term positioning in aviation, provided you’re comfortable with cyclical risk and high leverage. Want to dive into a comparison with SpiceJet or Air India’s private equity narrative? I can line that up next 🛫📈

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