Few equities, regardless of size, have survived the recent market drop that began on March 13. IndiGo is one of the select few stocks that have increased gradually but steadily despite a market where investors were becoming pessimistic. In the past month, it has increased by 13% in a sideways market and recently reached a lifetime high. It has produced slightly over 94% profits for its investors over the past year.

When an IndiGo plane touched Air India Express's wings on Wednesday at the Kolkata airport, the Directorate General of Civil Aviation (DGCA) opened an investigation. Brokerages suggest that although these on-the-ground incidents may cause some stock volatility, the stock's long-term prospects appear promising.

There seems to be good reason for the increasing speculation on this aviation stock. Indians have been bitten by the travel bug since the end of the plague, and it isn't going away. The majority of industry analysts predict that there will be 510 million air travelers by FY30, up from the 225 million projected for 2024.

According to a Nuvama report, "Indigo expects demand to remain robust with passenger traffic likely to grow 2.3x led by a shift in traffic from railways to airlines, accelerated airport expansion (Navi Mumbai and Delhi airports), rise in passport holding passengers and increase in connectivity to neighboring countries."

Furthermore, the trend of metro to non-metro travel is growing, which may accelerate the expansion of the passenger base. There will likely be two hundred domestic airports instead of the current 140.

The icing on the cake is that, following GoFirst's grounding last year and SpiceJet's persistent financial difficulties, the market is trending towards a "cosy" duopoly. With fewer competitors (mostly IndiGo and Air India), there is greater pricing discipline, which can eventually increase yields.