Shares of InterGlobe Aviation Ltd. are in focus today after the Competition Commission of India said it was reviewing allegations of anti-trust violations by IndiGo following mass flight cancellations earlier in December.
The CCI has “taken cognizance of information filed against IndiGo in the context of the recent flight disruptions witnessed in the aviation sector, across various routes” and decided to proceed with an initial assessment. It did not disclose details of the allegations.
One complaint, seen by Reuters, accuses IndiGo of cancelling flights and then offering seats at much higher prices, amounting to abuse of its dominant market position. The filing by lawyer Kartikeya Rawal alleges his ticket was cancelled and the replacement fare quoted was significantly higher.
In the first week of December, IndiGo cancelled about 4,500 flights due to poor pilot roster planning. That triggered one of India's biggest aviation crises with thousands of people stranded at airports. Flight ticket prices surged during the flight cancellations, prompting the government to impose temporary caps.
IndiGo, known for its on-time performance, has apologised for the flight cancellations, calling them a "blemish" on its record.
{{/usCountry}}IndiGo, known for its on-time performance, has apologised for the flight cancellations, calling them a "blemish" on its record.
{{/usCountry}}The disruptions underscored the risks of a near-duopoly in the world's fastest-growing aviation market, where IndiGo and Air India Ltd. together hold a more than 90% share. InterGlobe Aviation controls IndiGo, which has more than 60% market share.
IndiGo's share price is down by about 4.75% since the mass flight cancellations on 5 December. The stock experienced a much steeper drop in the interim, bottoming out around 11 December, before staging a partial recovery.