INDIGO FLIGHT DISRUPTION Good time to buy for long term as stock falls

The recent decline in IndiGo’s share price amid massive flight cancellations could be a good entry opportunity for long-terminvestors, analysts said on Friday.

- NIKITA VASHISHT

Though the stock may remain volatile in the near-termtill flight operations of the airline normalise on a durable basis, analysts believe the counter remains a “structural long-term bet” on India’s growingaviation story.

“Despite the near-term operational crisis, IndiGo’s long-term outlook remains intact as it is a long-term compounding story supported by disciplined low-cost model, India market dominance, strategic expansion, healthy balance sheet, and robust long-term growth prospects. New investors may use the dip to enter the stock,” said Narendra Solanki, head of fundamental research (investment services) at Anand Rathi Shares and Stock Brokers.

Besides, if someone bought the stock at a price higher than the current market price, he/she may increase the exposure to average their purchasing cost, Solanki said.

The brokerage initiated coverage on IndiGo stock in October with a ‘Buy’ rating and a target price of ₹7,000. IndiGo shares have slipped 9.1 per cent on the bourses, so far in December, as against a 0.6 per cent gain in the benchmark BSE Sensex index.

IndiGo flight cancellations