New Delhi: The hike in jet fuel prices will be passed on to both domestic and international consumers as increased airfares, IndiGo said on Friday after reporting a net loss of Rs 2,537 crore for the fourth quarter of the 2026 fiscal year. This compares to a profit of Rs 3,067 crore in the same period last year.
Jet Fuel Prices and Airfares
While jet fuel prices for international flights have more than doubled since pre-war levels, domestic fuel price hikes have remained capped. If the cap is lifted even marginally next week, domestic flights—with their truncated schedules—will cost more.
Financial Performance
After being profitable for two consecutive years, IndiGo reported a loss of Rs 2,394 crore for the full fiscal year 2026, compared to a profit of Rs 7,258 crore in FY25. The loss was attributed to an exceptionally sharp depreciation of the rupee, changes in labor laws, and a challenging operating environment, including airspace closures and elevated jet fuel prices.
The airline's stock closed 3.5% lower at Rs 4,405.95 on the BSE on Friday, while the broader market declined 1.4%. IndiGo is now studying whether fuel hedging could be an option given the current volatility.
Management Commentary
IndiGo Managing Director Rahul Bhatia said: “FY26 was marked by an exceptionally challenging operating environment, which materially impacted our profitability. Despite these conditions, the underlying performance of the business remained resilient. During the year, our capacity grew by 9.5% and total income increased by over 6%. Excluding the impact of foreign exchange and exceptional items, IndiGo delivered a profit of Rs 7,500 crore.”
In FY26, IndiGo suffered a hit of Rs 8,100 crore due to the rupee's depreciation, of which Rs 4,200 crore impacted the fourth quarter alone. The December flight disruption cost the airline an additional Rs 580 crore, and changes in labor laws resulted in a Rs 1,200 crore impact.
“We continue to maintain a strong balance sheet with substantial liquidity, demonstrating resilience through prolonged periods of volatility... While the near term remains volatile, we remain firmly focused on disciplined execution, cost efficiency, and long-term value creation,” Bhatia added.
Balance Sheet and Debt
IndiGo had a total cash balance of Rs 51,650.6 crore as of March 31, 2026. On the same date, its total debt, including capitalized operating lease liability, stood at Rs 77,749.2 crore.
Capacity Optimization and Route Recalibration
Regarding flight cuts, Bhatia said: “As we enter a seasonally softer demand environment from mid-June onwards, combined with elevated fuel prices, we are adopting a measured approach to optimize capacity. As a part of this, selective recalibration of certain routes is warranted to protect margins, as was done last year as well.”
December Operational Crisis
Addressing the December operational crisis that affected lakhs of passengers, Bhatia said: “Not only did the December disruption cause a significant impact on our results, what transpired fell short of the standards we set for ourselves when we began this journey in 2006. Our customers deserve better… I am grateful to the 12.3 crore customers who chose to fly with IndiGo during the financial year, for their patience, understanding, and continued trust during the disruption. At the same time, it is important to acknowledge the extraordinary professionalism, resilience, and sense of responsibility demonstrated by our frontline colleagues and operational teams in exceptionally demanding circumstances; their commitment and dignity under pressure truly reflects the spirit of IndiGo.”
