India Aviation: Outlook Improving, if Peace Holds

Research evidence excerpt

India Aviation: Outlook Improving, if Peace Holds

e disruption has relatively held, similar to the FY22/23 playbook, with the pricing Exhibit 3 - Domestic Departures - Drop in June

benefit possibly accruing to the industry rather than being competed away. 3,600

3,400

Contained Capacity Supporting Yields: Capacity growth has remained muted as both IndiGo / 3,2003,000 IndiGo

meltdown plus Seasonal CutsAir India rationalise schedules amid op challenges, seasonal weakness in demand and a focus 2,800 Indo-Pak Air India op West Asia conflict

on profitability. Daily domestic departures are down 4-9% YoY/MoM in June and are likely to 2,600 conflict crash

remain subdued through Sep. Int'l capacity cuts have been even sharper, particularly for Air 2,4002,200

India. IndiGo's Int'l ASK growth improved to flat YoY in May after declining 22-33% YoY over 2,000

Apr-25 May-25 Jun-25 Jul-25 Aug-25 Sep-25 Oct-25 Nov-25 Dec-25 Jan-26 Feb-26 Mar-26 Apr-26 May-26 Jun-26the prior 2 months, while Air India's Int'l ASKs are down ~30% YoY in Mar-May. With industry .

Source: MoCA

capacity staying disciplined & IndiGo signalling a pricing push to recover higher costs, yield

growth could remain healthy in FY27 (IndiGo yield JEFe: +10%/1% for FY27/FY28). Exhibit 4 - Monthly Intl ASK Growth - Indian

Carriers

Competitive intensity in Indian aviation remains low: A recent Bloomberg report suggests Air 30%

India, under Tata Group's direction, is shifting its focus from aggressive expansion to reducing 20%

losses by deferring aircraft deliveries, rationalising routes & delaying network adds. External 10%

headwinds have taken further toll on competition. In the meantime, IndiGo is using the current 0%