India’s largest airline, Indigo, that cancelled more than 2,500 flights within days last month causing massive disruptions, reported a 78% drop in profit in the December quarter, sending its shares down more than 3%.
The company, which reported results after market close on Thursday, made a provision of 5.8 billion rupees ($63 million) toward compensation following flight disruptions in December.
The larger impact on its earnings, however, was from a one-time charge owed to the implementation of new labor code and forex losses, together amounting to about 20 billion rupees.
The lack of progress on the U.S.-India trade deal has hurt investor confidence, contributing to capital outflows, and has weighed on the rupee, making it Asia’s worst performing currency last year — down about 5%.
The currency was last trading at 91.52 and experts predict it to slip further to 92 rupee per dollar level by end of March, which could spell more trouble for forex-exposed businesses including Indigo.
