Indian equity benchmarks rallied strongly on Tuesday, with the NSE Nifty 50 rising 1.64% to 24,011.35 and the BSE Sensex gaining 1.7% to 76,821.07, as reported by NDTV Profit. The aviation sector led the gains with SpiceJet shares rising 4.62% and InterGlobe Aviation gaining 3.71%, extending their recent momentum from the previous session. According to Business Standard, SpiceJet surged 5.02% while InterGlobe Aviation climbed 4.09% after crude oil prices fell sharply following reports of a preliminary peace agreement between the United States and Iran. The stock surge comes as Brent crude declined 5% below $84 per barrel after the US and Iran announced a peace deal, which will be signed on Friday, June 19, following which the Strait of Hormuz will reopen for shipments.
The stock surge comes as Brent crude declined 5% below $84 per barrel after the US and Iran announced a peace deal, which will be signed on Friday, June 19, following which the Strait of Hormuz will reopen for shipments. As reported by CNBC TV18, Brent crude has traded at an average of $100 per barrel ever since the Iran-US war started on February 28, hitting its war-high on March 31, 2026. According to latest analyst estimates, every $5 rise in Brent prices leads to a 13% impact on IndiGo's earnings. The last updated prices for aviation turbine fuel (ATF) were at ₹105 per litre in Delhi, with airlines deciding whether to opt in or out of the new ATF price stabilization scheme. Market experts note that WTI crude futures for July delivery fell 4.77% to $80.83 a barrel, while Brent crude futures for August delivery declined about 4% to $83.77 a barrel, as reported by NDTV Profit.
Brokerage firm Jefferies maintained its 'buy' recommendation on the stock with a price target of ₹5,380 per share, indicating an upside of 14.2% from its previous close of ₹4,709.7 per share. According to CNBC TV18, Jefferies said the airline's near-term focus is on pricing discipline over aggressive capacity addition and has managed cost inflation via a pragmatic growth approach. The company's international business remains a key growth driver via fleet and route expansion, with the brokerage noting that forex hedging coverage is being increased and the airline is expanding its customer base and geographic reach via new initiatives. As reported by NDTV Profit, the brokerage cited aviation demand, cost controls, fleet expansion, forex hedging and international routes as growth drivers, with management remaining focused on pricing over capacity amid cost inflation.
Of the 26 analysts who have coverage on the IndiGo stock, 21 have a 'buy' rating, three have a 'hold' rating and two have a 'sell' rating, as reported by CNBC TV18. Last week, incoming CEO Willie Warsh told CNBC-TV18 that IndiGo is a "fantastic airline" with ambitious growth plans, while warning that high fuel costs, aircraft groundings and taxation remained key challenges for India's aviation sector. The airline reported its fourth quarter earnings last month, with net profit declining to ₹2,536.3 crore from ₹3,067.5 crore in the previous year, as forex losses, elevated costs and exceptional charges weighed heavily on results. Despite the recent gains, the stock is still down 3.7% for the year. According to Business Standard, lower crude prices are generally positive for airlines as aviation turbine fuel (ATF) is one of their largest operating expenses, with the decline helping reduce fuel costs and support profit margins, particularly for carriers with significant domestic and international operations.
