IndiGo shares fell nearly 8% on Monday, deepening last week’s slide after the DGCA issued a show-cause notice. The stock is headed for its seventh consecutive decline, weighed down by thousands of flight cancellations that stranded passengers and prompted government intervention to curb soaring airfares. The stock is poised for a seventh consecutive day of decline following the cancellation of thousands of flights last week, which left passengers stranded and prompted the government to intervene to curb a sharp rise in airfares triggered by the situation. The share price continues to face severe selling pressure. It has fallen more than 12% as the airline’s operational crisis continued, dragging the stock to levels not seen in months. The market cap of the share has fallen below the Rs 2 lakh crore mark. The company, on its part, issued a statement attempting to calm the storm: “We acknowledge that IndiGo’s operations have been significantly disrupted across the network for the past two days, and we sincerely apologise to our customers for the inconvenience caused.”
Over the last five trading sessions, the share price of IndiGo has already fallen 16%.The latest trigger came from the Delhi Airport’s advisory that IndiGo flights may continue to face delays, just days after the Directorate General of Civil Aviation (DGCA) issued a show-cause notice to the airline. The aviation regulator is probing why IndiGo failed to adequately plan for updated Flight Duty Time Limitations (FDTL), the rules that govern pilot working hours.IndiGo’s troubles escalated dramatically on December 5, when more than half its flights were cancelled in a single day, leaving thousands stranded across major airports. The company attributed this to a system reboot coinciding with new duty rules for pilots, but the DGCA was unconvinced.According to the brokerage report by JM Financial, the recent meltdown stems from a combination of regulatory rule changes and IndiGo’s own operational gaps. The firm has maintained a ‘Reduce’ rating on the stock, warning that the financial hit may not be limited to the short term.
The brokerage noted that IndiGo’s operational expansion and tight cost structure had historically played a big role in its valuation. But the new disruptions have exposed deeper structural issues. As per the report, the recent cancellations were “largely a function of new FDTL norms impact kicking in immediately post Airbus software upgrade challenges.”
JM Financial added that the FDTL transition has exposed multiple planning lapses. The revised rules such as longer weekly rest hours, limits on consecutive night duties and expanded night-time restrictions have increased the required number of pilots significantly. The report said IndiGo “under-forecast captain (P1) requirements, delayed command upgrades, relied on reactive leave buybacks, and failed to realign rosters despite repeated DGCA warnings.”JM Financial estimated that if disruptions last around 15 days, the airline could face an 8–9% earnings hit for FY26, not including any penalty imposed by regulators. The brokerage added that the stock has not yet fully priced in “structural cost increase driven by regulatory actions” or a potential management change if required.