3. An unlisted company, IndiGo is not required to publish its profits
and revenues, but for fiscal year 2011, it saw a 48 per cent growth
in revenues and a profit of Rs.650 crore
A recent study by Centre for Asia Pacific Aviation (CAPA)
The study pegged IndiGo’s profitability in the first quarter of this
fiscal at Rs 106 crore.
5. 2006: Set up by Rakesh Gangwal and Rahul Bhatia, of
InterGlobe Enterprises aviation.
August 2006 : Started operations in India by
connecting Delhi to Imphal.
Operates 359 flights daily across 27 domestic cities and
5 international cities.
Fleet size is 58.
Indigo uses Airbus A 320-200 .
Market leader, 27% of the market share.
By early 2012, IndiGo had taken the delivery of its
50th aircraft in less than 6 years.
6. Indian Aviation Industry
High cost environment
High taxes on Aviation Turbine Fuel (ATF)
High airport charges
High debt burden and liquidity constraints
Competition by LCCs
A series of measures by the Government
Financial Condition - Losses of $2.5 billion
Banks unwilling to invest
7. AIRCRAFT MANAGEMENT
Indigo first purchased the aircrafts, then sold them to an
intermediary and then hire the fleet on lease from them on some
Use single configuration aircraft
For maintenance of aircraft, indigo allied with Airbus
Indigo preferred using Airbus crafts instead of Boeing’s as the
fuel efficiency of the former is greater than the latter
8. GROWTH AND EXPANSION STRATEGY
It adopted a strategy of starting with one aircraft and adding
one after every six week. In other way to say is that they first
tested one market and after establishing foothold in that
market, they expanded to other markets
Indigo signed a deal with Airbus and ordered 100 Airbus-320
9. Operational Efficiency
Collaborated with Quovadis ( a subsidiary of Airbus), Airport
authority of India and DGCA
Followed Required Navigation Performance Approach (RNP)
10. Advantages of RNP approach
Shorter trajectory for landing
Does not require ground based navigation
It helps in reduction of green house gas emission
12. Advantages of this model
Serve more markets with fewer fleets
First mover advantage
Indigo’s market share is almost similar to that of its
competitors but with a much lower fleet
The flight to market ratio for indigo is lower which
implies that it manages its fleet very efficiently.
13. CUSTOMER SERVICE
On time arrival &
Good connectivity Consistent service
•1% of the Revenue spent on Marketing and promotional activities.
•On Time performance
Technological tool – Aircraft
Performance Record > 90% communication addressing and
Reporting system (ACARS)
DGCA’s Record The
Indigo: 88.9% Fudge“
Jet Airways: 91.8%
14. HUMAN RESOURCE MANAGEMENT
Functional Skill Training
One •Cabin Crew
Customer Service & soft
m Leadership training attendant
•AWARD: Best company to work with as per Great Places to Work survey.
•Emphasis on Internal Job Posting and Promotion
•Attrition rate: Negligible or ZERO percent.
•Cost Saving Hired Kingfisher Pilots (200-300) Joining Bonus
19. • GOVERNMENT REGULATIONS
• INDIAN AVIATION POLICY
• RISING FUEL PRISES
OF NEW I • FUNDS & RESOURCES
ENTRANTS G • SET UP COSTS
H • IF THE BORROWING FROM BANKS BECOMES CHEAP THEN THE
THREAT MAY BE HIGH.
• DUOPOLY OF TWO MAJOR AIRCRAFT SUPPLIERS AIRBUS AND
BARGAINING H BOEING
I • SHORTAGE OF TRAINED PILOTS
POWER OF • ONLY 4 ATF SUPPLIERS : IOC, HINDUSTAN PETROLEUM
SUPPLIERS H CORPORATION, BHARAT PETROLEUM, ONGC
BUYING • LOW
O • NOT MUCH PRODUCT AND SERVICE DIFFERENTIATION AMONG
20. • LIMITED SCOPE OF PRODUCT & SERVICE
COMPETITIVE I • IMITATION
RIVALRY • NO CUSTOMER LOYALTY
G • STEAL CUSTOMERS FROM COMPETITORS INORDER TO
• OTHER MODES LIKE BUS/ TRAIN
OF • A NUMBER OF OTHER LOW COST AIRLINES
G • LOW SWITCHING COST
22. INTANGIBLE RESOURCES
• COVERED IN NEWS FOR EXCELLENT LOW COST
BRAND • MARKETING
AWARENESS • WORD OF MOUTH
• ON-TIME ARRIVALS
• AMICABLE RELATIONSHIP WITH SUPPLIERS
• COLLBORATION WITH HOTELS
SOCIAL CAPITAL • FOR Ex: , tie up with Mumbai based hotel chain
• EXCELLENT INCENTIVES FOR EMPLOYEESS
• LOOKING AT EXPANDING THE EMPLOYEE
RELATIONSHIP • NO SIGN ON DOWNSIZING
• LOKOUT FOR MORE PILOTS, CABIN
ATTENDENTS & AIRPORT SERIVE AGENTS
24. TOWS ANALYSIS
• INCREASE DOMESTIC
SO • UPGRDAE TO LONG HAUL
AIRCRAFTS AS PER DEMAND
• PLAN TO GO INTERNATIONAL
• EXPAND TO FREIGHT /
WO CARGO SERVICES
• DIVERSIFY TO CHARTERED
25. TOWS ANALYSIS
• SIGN ANTI POACHING
• EFFECTIVE INCENTIVE
PROGRAM TO PREVENT TALENT
• EMPHASIS ON TRAINING.
• HIRE FROM OTHER COUNTRIES
• MENTORING FROM RETIRED AIR
• continuous innovation of value
WT added services.
26. 49% FDI in the aviation sector
What is there in Store for the Flying
Help in fresh source of liquidity and
Opportunity for International Airlines to
set a strong foothold in Growing Indian
Foreign Airlines can compete in highly
28. Increased competition, better service,
greater efficiency and cheaper air fares.
Long term benefits to the industry in
terms of expertise, financial and strategic
Boost the tourism industry and
High Airport Fees
High cost of Air Turbine Fuel
30. FUTURE PLANS OF INDIGO AIRLINES
180 new aircrafts to acquired between 2015 – 2024.
Sale of old aircrafts and have trained personnel.
Going International in spite of being a Domestic Low
31. SCA STRATEGIES FOR INDIGO
Differentiate on services front like time and
quality of flying experience.
Demand pricing in comparison to uniform
Facilitate ease of purchase and accessibility
to the consumers.
Effective and better communication with
customers by establishing mass customer
32. Minimize on the operating cost by
connecting more flights among various cities
like more indigo airlines outlets.
Retain the old customers
Identify the various sources of ancillary
Target Tier II and Tier III cities with growing
33. Set up innovating student promotional
offers for student as they extensively use
Low budget carriers.
Tie up with Government agencies for least
popular tourist destination and provide