Shares of InterGlobe Aviation, the parent company of IndiGo Airlines, fell sharply in early trade on Monday, dropping 6.6 per cent
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MUMBAI — Shares of InterGlobe Aviation, the parent company of IndiGo Airlines, fell sharply in early trade on Monday, dropping 6.6 per cent to an intra-day low of Rs 5,015 on the BSE.
However, it recovered later as around 9:45 a.m., the shares were trading at Rs 5,159.50, down by Rs 211 or 3.93 per cent.
The sell-off came after the Directorate General of Civil Aviation (DGCA) extended the deadline for IndiGo CEO Pieter Elbers to respond to a show-cause notice linked to the airline’s recent operational disruptions.
The aviation regulator had issued a show-cause notice to IndiGo’s accountable manager on Sunday, just a day after sending a similar notice to CEO Pieter Elbers.
The DGCA said that the airline’s massive wave of cancellations over the past week caused widespread inconvenience and distress to passengers across the country.
According to the regulator, the disruptions were largely triggered by IndiGo’s failure to plan properly for the rollout of the revised Flight Duty Time Limitations (FDTL) rules.
These rules, which lay down the duty hours and mandatory rest periods for flight crew, came into effect recently and have created significant operational challenges for the airline.
In its notice, the DGCA pointed out that IndiGo’s “large-scale operation failures” suggest major lapses in planning, oversight and resource management.
The accountable manager has been given 24 hours to explain why enforcement action should not be taken. If the airline fails to respond within the extended deadline, the DGCA has said it will proceed based on the information available.
Even as the regulatory pressure increases, IndiGo said on Sunday that it has restored 95 per cent of its network and plans to operate around 1,500 flights.
The airline claimed that its operations are on track to stabilise by December 10, with improving on-time performance and fewer cancellations.
However, more than 220 flights had already been cancelled across major airports by the time of reporting, adding to the inconvenience faced by thousands of passengers.