‘Significant lapses in planning’: Moody’s slams IndiGo; terms flight disruptions ‘oversight’
According to Moody’s, the disruptions underline weaknesses in IndiGo’s preparedness for regulatory changes, with the scale of operational breakdowns raising concerns despite the carrier’s otherwise strong market position.
The agency noted that insufficient adjustments to crew scheduling under the new norms resulted in widespread service disruptions, affecting thousands of passengers.
The rules cap night landings and mandate longer weekly rest periods for pilots, sharply reducing crew availability if roster planning is not adjusted in advance.The assessment comes as shares of InterGlobe Aviation, the parent of IndiGo, extended their sharp fall on Monday, sliding as much as 10% intraday and taking losses to about 16.4% over six sessions.
The sell-off has erased more than Rs 37,000 crore from the airline’s market capitalisation, as investors reacted to the operational fallout from the rollout of the new Flight Duty Time Limitations (FDTL).IndiGo, which controls close to 66% of India’s domestic aviation market, faced acute pilot shortages as it struggled to realign schedules under the revised framework.
The crisis peaked with more than 1,000 flights cancelled in a single day—nearly half of its daily operations—leaving thousands of passengers stranded across major airports.The operational turmoil has triggered a wave of brokerage recalibrations.
UBS maintained its Buy rating on InterGlobe Aviation but cut its target price to Rs 6,350, citing inadequate readiness for the FDTL transition and higher cost assumptions for FY26–FY28.
The brokerage factored in increased crew strength requirements and higher operating costs, compounded by the rupee’s depreciation, according to an ET report .Investec remained bearish with a Sell rating and a target of Rs 4,040, pointing to rising fuel costs, a weaker rupee near 90 to the dollar and the need for around 20% more pilots per aircraft once full compliance with the norms is required by February 10, 2026.
It warned that, without fare hikes, the changes could shave nearly 25% off profit before tax.Jefferies, while reiterating a Buy call, cautioned that IndiGo’s cost curve is turning adverse as employee expenses rise, pilot productivity falls under the new rules and dollar-linked costs such as leases, maintenance and fuel move higher.Regulatory scrutiny has also intensified.
The Directorate General of Civil Aviation has given IndiGo CEO Pieter Elbers additional time to respond to a show-cause notice over the disruptions and to explain why enforcement action should not be initiated under aviation rules.Despite the sharp correction, InterGlobe Aviation shares are still up about 7% on a year-to-date basis, highlighting the tension between near-term execution risks flagged by Moody’s and brokerages, and the airline’s longer-term growth expectations.
