IndiGo doubles Airbus A350 order to 60 jets: Will this reshape Indian long-haul aviation?

InterGlobe Aviation Limited (NSE: INDIGO), India’s largest airline by market share and passengers carried, has formally expanded its long-haul strategy with a major commitment to wide-body aircraft. On June 1, 2025, the company announced a Memorandum of Understanding with Airbus SE to convert 30 purchase rights into firm orders for the Airbus A350-900 aircraft, effectively doubling its existing firm order from 30 to 60 planes.

This decision builds upon a milestone agreement first signed in April 2024, when IndiGo placed its initial order for 30 A350-900 jets and secured options for 70 more. At that time, the airline had only just begun charting its course into wide-body operations—a significant shift for a carrier known primarily for its narrow-body fleet of over 400 aircraft.

By expanding its firm order, IndiGo has made clear its ambition to emerge as a serious long-haul competitor, not just within South Asia but in global markets that have long been the domain of full-service international airlines. The first batch of deliveries is expected in 2027, offering ample lead time to prepare operational infrastructure, crew capabilities, and route alignments.

What Does the Airbus A350 Bring to IndiGo’s Strategy?

The Airbus A350-900 is considered one of the most advanced long-range aircraft in the world, designed for high efficiency and range. IndiGo’s configuration will use Rolls Royce‘s Trent XWB engines—known for their fuel efficiency and reliability—helping the airline maximize route flexibility and operating margins on longer sectors.

This aircraft allows non-stop operations from India to major European, Southeast Asian, and potentially North American gateways. The move also helps IndiGo better align with international hub strategies of alliance partners. While the carrier has not yet officially joined a global alliance, its growing codeshare agreements with Turkish Airlines, Qatar Airways, and others suggest strategic interest in integrated global networks.

The A350 acquisition gives IndiGo a crucial foothold to develop new revenue streams, including premium cabin services, business class, and differentiated customer experience—areas that have historically been outside the scope of its low-cost carrier (LCC) model.

How Does IndiGo’s Expansion Compare to Industry Trends?

IndiGo’s latest fleet expansion aligns with a global aviation trend where full-service and hybrid carriers are scaling up long-haul capabilities to capture pent-up international demand post-COVID. The Indian government’s ‘Vision 2040’ for aviation—focused on expanding airport capacity and positioning India as a global aviation hub—has only accelerated interest in international routes and direct connectivity.

In comparison, Air India, now under Tata Group control, announced an unprecedented 470-aircraft order in 2023, which included 40 Airbus A350s. While Air India is pursuing a premium, full-service international model, IndiGo’s positioning focuses on scalability and operational simplicity. However, the addition of A350s blurs the distinction and suggests a willingness to straddle both LCC efficiency and wide-body sophistication.

How Has the Stock (NSE: INDIGO) Reacted?

As of May 30, 2025, shares of InterGlobe Aviation Limited closed at ₹5,325.00, up ₹3.00 or 0.06% from the previous day. The stock has shown steady appreciation throughout FY25, reflecting investor confidence in the airline’s fleet expansion, strong quarterly results, and robust demand fundamentals in domestic and short-haul international markets.

Traded volume stood at 17.44 lakh shares with a turnover of ₹930.61 crore, while delivery volume made up 66.94%—a positive indicator of investor intent to hold. The market cap of the company now stands at ₹2.05 lakh crore, with a free float value of ₹1.04 lakh crore. At an adjusted P/E of 28.38, valuation remains in line with sector expectations, though analysts note that further earnings upgrades may hinge on execution of long-haul strategy.

The 52-week high for INDIGO stock is ₹5,665.50, while the low is ₹3,780.00. The recent consolidation above ₹5,300 suggests investor optimism surrounding the A350 announcement has already been priced in, but with room for further upside if long-haul routes begin showing financial traction.

What’s the Institutional and Forum Sentiment Around the Announcement?

Institutional investors have largely welcomed the strategic clarity provided by IndiGo. Global brokerages tracking Indian aviation are treating the A350 order expansion as a long-term positive, especially in light of the upcoming 2027 delivery window, which provides enough lead time to mitigate execution risk.

Forum investors, particularly on Indian investor communities such as ValuePickr and TradingView India, are already speculating on potential routes, yields, and fleet utilization scenarios. Many long-term investors view the A350 bet as an inflection point for InterGlobe Aviation, potentially enabling it to match the scale of regional heavyweights like Emirates or Singapore Airlines in specific corridors.

FII activity has been steady through May 2025, with data indicating continued inflows into Indian aviation stocks as a broader macro bet on India’s consumer travel boom. Domestic mutual funds, particularly in the mid-cap thematic space, are also maintaining exposure to IndiGo due to its leadership position and low leverage profile.

How Will This Affect IndiGo’s Operational and Financial Profile?

This is the most capital-intensive strategic move in IndiGo’s history. A list-price A350-900 aircraft costs approximately $317 million, meaning the gross value of the 60-aircraft deal crosses $19 billion. However, IndiGo is expected to have negotiated significant discounts with Airbus, possibly bringing the total order value closer to $12–14 billion.

Operationally, integrating wide-body aircraft will demand significant changes across IndiGo’s current systems. These include crew certifications for long-haul duty, international maintenance partnerships, premium ground handling, and differentiated cabin services. The airline has already begun the transition by introducing six temporarily leased wide-body jets in March 2025, with delivery schedules concluding by 2026.

These interim aircraft serve as a testbed for operating long-haul flights while training staff and refining service protocols ahead of full-scale A350 deployment. This phased approach could significantly de-risk the transition and help preserve IndiGo’s cost-efficient DNA even as it steps into more complex network configurations.

Is This a Structural Pivot or an Extension of IndiGo’s Existing Model?

There is strong evidence that this is a structural pivot for IndiGo. The airline, which has long championed point-to-point connectivity within India and the near-abroad, is now preparing for a hub-and-spoke configuration that leverages its stronghold in metros like Delhi, Mumbai, Bengaluru, and Hyderabad.

The push into long-haul markets will likely open new revenue lines, including cargo, premium services, and potentially business travel—segments where IndiGo has limited presence today. Analysts believe the A350s may initially serve high-density corridors to Europe and East Asia where bilateral agreements and passenger traffic volumes already exist.

Moreover, the government’s supportive stance on building global aviation hubs in India—with upcoming mega-airports in Noida, Navi Mumbai, and Jewar—creates a conducive backdrop for this transformation.

What’s Next for IndiGo and Indian Aviation?

India’s domestic aviation sector continues to grow at double digits, but international capacity is still under-penetrated. With India representing less than 3% of global long-haul capacity despite being the world’s third-largest aviation market, IndiGo’s move is strategically timed to capture emerging demand.

The government’s UDAN scheme, along with record capital investments in airport infrastructure, further enhances the operational backbone needed to support long-haul hubs. If IndiGo executes successfully, it could emerge as the first low-cost airline globally to run a sustainable wide-body business at scale.

Looking ahead, analysts expect IndiGo to finalize the cabin configuration of its A350s by mid-2026 and begin route announcements shortly thereafter. Early focus is likely to be on high-traffic routes to London, Frankfurt, Paris, Tokyo, and select U.S. cities.

Key Takeaway: IndiGo is no longer simply a domestic aviation success story—it’s fast becoming a cornerstone of India’s global aviation ambitions. With a 60-jet wide-body order and a clear roadmap to 2027, the airline is reimagining what it means to be a low-cost carrier in the long-haul era.