IndiGo Shares Drop 3% as DGCA Probes Massive Flight Cancellations; Stock Hits Five-Month Low

The shares of InterGlobe Aviation, the parent company of IndiGo, slipped more than 3 percent on December 4, extending the previous day’s decline. The fall comes amid one of the airline’s most serious operational disruptions in recent years, triggered by large-scale flight cancellations across major airports in India.

IndiGo’s stock dropped to ₹5,405 in the morning, its lowest level in over five months, reflecting investor concerns as the crisis deepened. The stock had already fallen nearly 2 percent on Tuesday, closing at ₹5,595.50, and is now down about 6 percent in the past five days. However, over the last six months, the stock has gained more than 2 percent, and remains up over 20 percent in 2025, with a current P/E ratio of above 32.

Massive Cancellations Trigger Market Reaction

The sharp fall in IndiGo’s share price comes after the airline cancelled around 200 flights on Wednesday, marking one of its most severe operational breakdowns in recent years. The disruptions have severely impacted passengers across the country, with cancellations extending into Thursday as well.

A shortage of crew, especially pilots, has been cited as a major reason behind the cancellations. The issue surfaced after the government introduced revised Flight Duty Time Limitation (FDTL) norms last month. These new rules require longer rest periods and more humane work schedules for flight crew.

While the revised FDTL norms aim to improve crew welfare and operational safety, IndiGo appears to be struggling to realign its network and crew availability in line with the new regulations. This has resulted in widespread disruption, especially across metro airports.

Airport-Wise Breakdown of Cancellations

According to PTI, several key airports across India reported significant cancellations:

Delhi – 33 Flights Cancelled

Delhi’s Indira Gandhi International Airport saw at least 33 cancellations on Wednesday. The situation added to congestion and inconvenience for passengers, many of whom reported last-minute alerts and difficulty rebooking flights.

Mumbai – Over 51 Flights Cancelled

Mumbai’s Chhatrapati Shivaji Maharaj International Airport experienced over 51 cancellations, making it one of the worst-affected hubs during the disruption.

Bengaluru – 73 Flights Cancelled on Thursday

The disruption spilt over to the next day as well. On Thursday, Bengaluru’s Kempegowda International Airport saw nearly 73 cancellations, worsening the travel experience for flyers and raising questions about the airline’s preparedness.

Combined, these numbers highlight the scale of the operational challenge IndiGo is facing, with ripple effects across its network.

Also Read: Fitch Raises India’s FY26 Growth Forecast to 7.4% as Private Consumption Strengthens

IndiGo Issues Public Apology

Amid mounting travel chaos and widespread criticism, IndiGo issued a statement acknowledging the massive disruption.

“We acknowledge that IndiGo’s operations have been significantly disrupted across the network for the past two days, and we sincerely apologize to our customers for the inconvenience caused,”
—IndiGo spokesperson

The airline has not provided a specific timeline for when normal operations will resume but indicated that efforts are underway to stabilise the schedule.

DGCA Launches Probe, Seeks Detailed Report

The Directorate General of Civil Aviation (DGCA) has taken note of the widespread cancellations and has asked IndiGo to submit a detailed report. The regulator is examining whether the disruption was caused solely by crew shortages or whether there were deeper operational lapses.

While the DGCA has not announced punitive measures yet, the probe itself signals regulatory seriousness, especially given IndiGo’s dominant market share.

Stock Performance: Short-Term Pain, Long-Term Gains?

Short-Term Decline

The market response has been swift, with the stock sliding:

• 5-month low of ₹5,405

• Down 3% on December 4

• Down 6% in the last 5 days

Investors appear worried about the financial and reputational hit arising from such a large-scale disruption.

Medium-Term Performance Still Positive

Despite the recent fall, IndiGo’s broader performance indicates strength:

• Up more than 2% in the last six months

• Up over 20% in 2025 so far

These gains reflect strong demand trends in the aviation sector earlier this year, even though the current disruption has tempered sentiment.

Valuation

The company’s P/E ratio stands over 32, signalling continued investor confidence, though the operational challenges may cause near-term volatility.

What Happens Next?

The immediate future for IndiGo hinges on three factors:

1. How quickly can it restore normal operations after aligning crew schedules with the new FDTL rules?

2. The findings of the DGCA probe could determine future compliance measures.

3. Investor sentiment which will depend on how effectively the airline manages the fallout.

The situation remains fluid, and the stock could continue to see movement based on regulatory developments and the pace at which IndiGo resolves network disruptions.

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