IndiGo’s Premium Push Gets Thumbs Up From Brokerages

IndiGo’s latest launch of its business class offering, 'IndiGo Stretch', has garnered favorable reviews from leading brokerages. Emkay sees the premiumisation strategy boosting medium-term yields.

The airline also launched a new loyalty program—IndiGo BluChip. These expansion strategies will help IndiGo attract additional passengers and reinforce its market position, according to Citi.

IndiGo Stretch will debut on the Mumbai-Delhi route by mid-November at an introductory price of Rs 18,000. The latest announcements come as part of its 18th anniversary celebrations. The airline's strategy includes significant investments in premium services and technology upgrades. With plans to introduce wide-body A350-900 aircraft in 2027 and A321 XLRs starting in 2025, IndiGo aims to enhance its network and service offerings.

Here is a look at what brokerages have to say about the airline's new business strategy.

Citi has maintained a 'buy' rating with a target price of Rs 5,200 per share, suggesting an upside of 23.2% from the stock's previous close.

IndiGo Stretch will initially be available on 12 metro-to-metro routes. Each aircraft will feature 12 business class seats in a 2×2 configuration, catering to the premium market segment, the brokerage noted.

Citi further underscores the significance of IndiGo’s new loyalty program, IndiGo BluChip, which offers a non-expiring points system designed to enhance customer retention. The airline also plans a comprehensive digital upgrade to improve user experience on its website and app.

The brokerage anticipates that these developments—along with the ongoing expansion strategy, including a new aircraft delivery every week for the next decade and a fleet doubling by 2030—will help IndiGo attract additional passengers and reinforce its market position.

"With the business class and loyalty program, the company could attract incremental passengers which would augment its already-high market share," Citi said.

The brokerage's valuation is based on 2.6 times the September 2025 EV/sales estimates, at a 10% premium to Indigo's five-year average multiple.

Emkay Research has also maintained a 'buy' rating for the stock with a target price of Rs 5,300 per share, implying a potential upside of 25% from the stock's previous close.

The brokerage views IndiGo’s premiumisation strategy, including the introduction of new aircraft models, such as the A321 XLR and A350s, as a move likely to bolster yields over the medium term.

Emkay has retained its earnings estimates and values IndiGo at 20 times the September 2026 target price-to-earnings ratio.