IndiGo operator gains as Morgan Stanley sees raises target price

"We are positive on the stock due to market share gains and improving competitive landscape," Morgan Stanley said

Shares of InterGlobe Aviation, the operator of low-cost carrier IndiGo, gained another one percent intraday on June 19 after global brokerage Morgan Stanley said it expects 28 percent potential upside from the current level.


"We maintain overweight call on the stock with a target price at Rs 2,132 after the company ordered CFM LEAP-1A engines worth $20 billion," the research firm said.

Order changes supplier for Neo engines from Pratt&Whitney to CFM and company may also gain from fleet mix changes as Neos come in, it added.

"We are positive on the stock due to market share gains and improving competitive landscape," Morgan Stanley said.

IndiGo, on June 17, ordered CFM International LEAP-1A engines to power its 280 Airbus A320neo and A321neo aircraft. The contract includes spare engines and an overhaul support agreement.

Global brokerage house Credit Suisse, on June 18, also maintained outperform call on the stock and raised the target price to Rs 1,900 from Rs 1,800 after upgrading earnings growth estimates to 16/18 percent for FY20/21.

The stock rallied 51 percent in the last six months on the back of gaining market share from Jet Airways and stable crude oil price. At 0920 hours IST, it was quoting at Rs 1,677.25, up to Rs 14.05, or 0.84 percent on the BSE.

Disclaimer: The views and investment tips expressed by brokerages on moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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