IndiGo's share price rallied up to 14 percent in the morning session of Wednesday's trade after it reported better-than-expected earnings despite nationwide lockdown and rise in costs.

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On the NSE, the stock traded 14 percent higher during the day to Rs 1,076.70 per share. The stock price lost minor gains to end 7.84 percent at Rs 1.019.70.

India's largest passenger air carried reported a net loss of Rs 870.8 crore in the March quarter 2020 due to weak operating performance. Last year, the company had posted a net profit of Rs 596 crore in the same period.

Net revenue for the fourth quarter grew only 4.5 percent year-on-year (YoY) to Rs 8,635 crore as compared to Rs 8,260 crore a year earlier. "Closure of flight operations during national lockdown on account of COVID-19 significantly impacted revenue for the quarter," it said in a regulatory filing.

The earnings before interest, tax, depreciation, amortisation and rent margin for the airline during the period between January-March stood at 1 percent as compared to 27.9 percent a year ago. Its yield rose 1 percent YoY to Rs 3.74 a km from Rs 3.70 a km earlier.

As of March 31, the airline company had a total cash balance of Rs 20,377 crore with Rs 8,928 crore as free cash and Rs 11,448 as restricted cash. The total debt stood at Rs 22,719 crore.

At the end of March, IndiGo had 262 aircraft including 123 A320 ceos, 100 A320 neos, 14 A321 neos and 25 ATRs. It operated a peak of 1,674 daily flights, including international ones, during the March quarter.

Also Read: 10 key takeaways from IndiGo's Q4 earnings

In the post-earnings conference call, CEO Ronojoy Dutta said that the suspension of all airline operations has impacted the operating performance. The airline is now taking various cash-conversion and cost-cutting measures to survive, he said.

He further added that salaries had been cut between 5 percent-25 percent for most staff, bonuses were deferred and leave without pay schemes implemented for May-July.

Apart from that, IndiGo is also reworking vendor contracts and deferring 50 percent of supplementary rentals this year in order to save Rs 3,000-4,000 crore cash over nine months.

Dutta also added that there has been no evidence of contamination in the aircraft or of passengers passing it to others. He further said that 120 A320 ceos would be going out of the airline's fleet in the next two years and new neo aircraft would be taken.

Among brokerages, Credit Suisse remained bullish on the stock and maintained 'outperform' rating with target price lowered to Rs 1,300 from Rs 1,500 earlier.

It retained a bullish stance on likely resumption on profitability by FY22. It feels the company has a strong balance sheet that ensures survival while peers struggle.

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First Published:Jun 3, 2020 10:35 AM IST