IndiGo Share Price Drops Nearly 2% Amid Market Share Loss and Pilot Allowance Hike

Shares of InterGlobe Aviation, the parent company of IndiGo, slipped nearly 2% on December 30, tracking market concerns over falling market share and rising pilot allowances.

Market Performance

As of 11:45 am on December 30, IndiGo shares were trading 1.7% lower at ₹4,999 per share, reflecting a cautious sentiment among investors. The stock has recorded a nearly 15% decline so far this December, amid operational challenges and regulatory scrutiny.

Market Share Pressure

IndiGo, the largest domestic airline in India, faced a small dip in market share for November 2025, according to Directorate General of Civil Aviation (DGCA) data:

• October 2025: 65.6%
• November 2025: 63.6%

This 200 basis point (bps) decline comes as competitors like SpiceJet and Air India expanded their footprint:

• SpiceJet: up 110 bps to 3.7%
• Air India Group: up 100 bps to 26.7%
• Akasa: down 50 bps to 4.7%

The drop in IndiGo’s market share coincided with operational disruptions, including mass flight cancellations in late November that left passengers stranded across India.

Pilot Allowance Hike

In response to operational pressures and morale concerns, IndiGo announced an increase in pilot allowances:

• Layover allowance:
  • Captains: ₹3,000 from ₹2,000
  • First Officers: ₹1,500 from ₹1,000
• Deadheading allowance:
  • Captains: ₹4,000 from ₹3,000
  • First Officers: ₹2,000 from ₹1,500
• Additional hours beyond 24-hour window:
  • Captains: ₹150 per hour (up from ₹100)
  • First Officers: ₹75 per hour (up from ₹50)
• Night allowance per night hour:
  • Captains: ₹2,000
  • First Officers: ₹1,000

IndiGo employs roughly 5,000 pilots, and these allowance revisions aim to boost pilot morale after operational strain caused by stringent roster requirements.

Operational Overview

The airline continues to operate under scrutiny from regulators after cancelling around 4,500 flights in early December. The DGCA had instructed IndiGo to cut its winter schedule by 10%, ensuring compliance with Flight Duty Time Limit norms, which disrupted operations in late November and early December.

• On-Time Performance (OTP): declined to 69.0% in November from 84.1% in October
• Akasa: led punctuality with 72.2% OTP
• Domestic traffic: boosted by festive season demand but moderated due to disruptions

Key Takeaways

IndiGo’s recent challenges highlight the fragile balance between market dominance, operational efficiency, and workforce morale:

• Market share dipped 200 bps month-on-month in November 2025
• Competitors gained slots and expanded fleet, impacting IndiGo’s footprint
• Strategic allowance hikes aim to stabilize pilot engagement after flight cancellations
• OTP dropped significantly, reflecting operational strain

The IndiGo share price continues to track these developments closely, reflecting market sensitivity to both operational performance and cost management initiatives.

Source: Moneycontrol