Airspace Closures, Fuel Costs Threaten IndiGo, SpiceJet Profitability

• Geopolitical tensions in the Middle East force Indian airlines to cancel flights to the region and Europe.
• HSBC report: Cancellations impact 20% of IndiGo's capacity, 32% of SpiceJet's, and 40% of Air India's.
• IndiGo faces daily revenue loss of Rs 45-50 crore and profit loss of Rs 4-5 crore due to cancellations.
• Rising jet fuel prices add pressure; a $1/bbl increase impacts IndiGo's annual fuel bill by Rs 300 crore.
• HSBC maintains 'buy' on IndiGo, citing intact long-term thesis, but keeps 'reduce' on SpiceJet.