US-based global ratings giant, Moody's Ratings, released a report on Monday, December 8, 2025, stating that IndiGo's ongoing flight disruptions are a 'credit negative' for its parent company, InterGlobe Aviation. The report highlighted the significant financial impact on India's largest airline operator, primarily due to revenue loss from flight cancellations. This financial damage is compounded by customer refunds, other passenger compensations, and the looming possibility of penalties from the Directorate General of Civil Aviation (DGCA).

Moody's explicitly stated, “The disruptions are credit negative because IndiGo could face significant financial damage from loss of revenue because of flight cancellations, refunds and other compensation to affected customers, along with potential penalties imposed by DGCA.” The ratings agency further explained that these disruptions stem from regulatory changes in the Flight Duty Time Limitations (FDTL) norms, for which IndiGo demonstrated a lapse in planning. Analysts at Moody's criticized this oversight, noting, “Recent flight disruptions underscore significant lapses in planning, oversight and resource management by IndiGo because the new regulations had been known to the industry for more than a year.”

The DGCA has issued a show-cause notice to IndiGo, and Moody's indicated that this crackdown could potentially affect the continuity of senior leadership within the airline. While no penalty has been imposed on IndiGo or InterGlobe Aviation yet, it remains a future possibility. In response to slower hiring in the airline's operations, Moody's has downgraded IndiGo's human capital score from 3 to 4.

Despite these challenges, Moody's affirmed that the fundamental strength of IndiGo's Baa3 rating remains intact, citing its dominant market share, low penetration rates for air travel in India, strong macro growth fundamentals, and sustainable long-term leverage below 3.5x. However, the ratings giant concluded that the airline's profitability will be negatively impacted in the current fiscal year, which ends on March 31, 2026.

In the wake of these developments, InterGlobe Aviation (IndiGo) saw its share price close 8.28% lower at ₹4,926.55 after Monday's stock market session, a notable drop from its previous close of ₹5,371.30, according to BSE data. Over the last five years, IndiGo shares have provided investors with over 183% returns, and more than 9% in the last one-year period. However, on a year-to-date basis, the stock is up 6.78% in 2025, but has seen a significant decline of 12.19% in the last one-month period and 15.33% over the last five market sessions.

Amid the crisis, IndiGo announced on Monday that it was set to operate more than 1,800 flights in an effort to fully restore its operations. The company also disclosed that it has already refunded ₹827 crore to its customers, with the remaining refunds for cancellations up to December 15, 2025, still in process.