Covid-19 infections are rising exponentially in India and naturally, that makes people fearful of venturing out. This means passengers are likely to delay their travel plans, which in turn postpones the recovery in the aviation industry. Unsurprisingly then, increasing covid-19 cases have emerged as a big worry for airlines.
But shares of InterGlobe Aviation Ltd don’t seem to be reflecting these concerns adequately, trading at around ₹1,605 apiece. InterGlobe runs the IndiGo airline, India’s largest by market share. So far in 2021, the IndiGo stock has declined by just around 7%. True, this represents an underperformance vis-à-vis the Nifty 500 index, which has increased by nearly 6% during the same time. Even so, analysts reckon IndiGo’s shares have been quite resilient.