InterGlobe Aviation Ltd, the operator of IndiGo, said its quarterly profit surged five-fold, beating analysts’ estimates, as yields rose and the airline carried more passengers amid the collapse of rival Jet Airways (India) Ltd following funding woes.

Net profit rose to ₹589.59 crore in the quarter ended 31 March from ₹117.64 crore a year earlier, InterGlobe Aviation said. That compares with the ₹378.7 crore average profit estimates compiled by Bloomberg. Its full-year profit, however, fell 93%, the steepest since the company started trading publicly in 2015.

Indian airlines, including IndiGo and SpiceJet, have been vying for lucrative airport slots left vacant by the grounding of Jet Airways in March. Local airlines are aggressively expanding their fleet and adding new routes to benefit from the shutdown of India’s second largest airline.

IndiGo, the country’s largest airline by market share, flew 15.7 million domestic passengers during the March quarter compared to 13.4 million in the year earlier.

“The situation with Jet Airways, during February and March, increased our unit revenue by 3-4%," the airline’s chief executive Ronojoy Dutta told analysts at a post-earnings conference call. “Our April revenues were, in fact, the most affected by the shutdown of Jet Airways, and it’s stronger than what we reported in March."

IndiGo’s March quarter revenue grew 35.5% to ₹8,259.81 crore from ₹6,097.68 crore a year ago. Fuel cost during the quarter rose 19% to ₹2,781.28 crore.

Indigo said its total debt at the end of the March quarter stood at ₹2,429.2 crore.

For the year ended 31 March, the airline reported a profit of ₹157.25 crorecompared with ₹2,242.32 crore in the previous year. Revenue rose 24% to ₹29,821.37 crore.

“Fiscal 2019 was a tough year for the airline industry in India because of high fuel prices, weak rupee and an intense competitive environment. However, it is a tale of two halves for IndiGo, with the first half of the year incurring losses and the second half of the year experiencing a sharp recovery," Dutta said in a statement.

“Looking ahead, it is difficult not to be bullish about the future. We see plenty of opportunities for profitable growth in our network and with a robust delivery stream of new aircraft, we are well positioned to capitalize on this growth," he added.

“During the first two quarters of fiscal year 2019, IndiGo saw a rise in costs—due to rise in fuel prices and fall in the rupee against the dollar—while its yields fell due to the prevailing price wars between airlines," an analyst tracking the company for an international brokerage said on the condition of anonymity. “However, IndiGo’s yields started improving during the third and fourth quarters, which pushed it towards a yearly profit."

Dutta said the future performance of the airline will depend on whether the new capacity deployed by IndiGo finds traction in the market, and whether pricing discipline is maintained by rivals. He added that the airline’s total capacity will rise 30% at the end of the current year.

IndiGo will add 53 narrow body aircraft, including 15 Airbus A321 aircraft during the current financial year, Dutta said, adding that the airline will also take delivery of 11 ATRs.

At the end of the March quarter, the airline’s fleet size stood at 217 aircraft, which included 130 Airbus A320ceos, 71 A320neos, one A321neo and 15 ATRs, a net increase of nine aircraft in the March quarter.

The airline is also eyeing a 5% improvement in unit revenue during the current fiscal, Dutta said.

On reports of a tussle between the company’s promoters, Rahul Bhatia and Rakesh Gangwal, Dutta said there is no difference between the promoters on strategy or international expansion.

“Both are (currently) debating on a single issue. We are optimistic that it will be resolved soon," Dutta said without elaborating further.

On Monday, InterGlobe Aviation’s shares rose 2.52% to ₹1,663 on BSE, outperforming the benchmark Sensex that rose 0.63% to 39,683.29 points. The results were announced after market hours.

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