IndiGo shares fall 3% after UBS cuts target price. What are analysts worried about?
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Shares of Interglobe Aviation, the parent company of IndiGo, tumbled as much as 3% to their day’s low of Rs 4,381 on the BSE on Friday after UBS cut the target price to Rs 5,480, an upside of 22% from the last close, while maintaining a Buy call on the counter. The international brokerage said the ongoing geopolitical conflict could weigh on airlines’ available seat kilometres (ASK) in the near term, while rising crude prices pose an additional risk to earnings. It also noted that weakness in the Indian rupee against the US dollar could create medium-term headwinds for the sector. UBS expects these factors to begin impacting earnings from Q4FY26, prompting a more conservative near-term valuation. However, the brokerage believes IndiGo’s long-term investment case remains intact, noting that industry downturns have historically favoured efficient players. It added that it will continue to monitor macroeconomic and geopolitical risks, and pr...