Shares of Indian domestic airlines soared on Thursday, a day after the civil aviation ministry said it would lift ticket price limitations imposed two years ago due to the coronavirus outbreak.
InterGlobe Aviation Ltd, the parent company of top airline IndiGo, surged as much as 2.3% to 2084.6 rupees, while smaller rival SpiceJet Ltd rose as much as 7% to 47.9 rupees.
To prevent ticket prices from skyrocketing after limitations on air travel were lifted, the government created a minimum and maximum band based on flight time.
With the introduction of Akasa Air and the resurrection of Jet Airways, competition in the Indian aviation industry is set to flare up. The next festival season is likely to enhance air travel demand, with passenger numbers already approaching pre-COVID levels. However, high fuel prices continue to be a drag.