Evening, ladies and gentlemen, and welcome to IndiGo's conference call to discuss the Fourth Quarter and Fiscal Year 2022 Financial Results. My name is Faizan, and I'll be your coordinator. At this time, the participants are in a listen-only mode. A question and answer session will follow today's management discussion. As a reminder, today's conference call is being recorded. I would now like to turn the call over to your moderator, Ms. Richa Chhabra from the Investor Relations team of IndiGo. Thank you, and over to you, ma'am. Good evening, everyone, and thank you for joining us for the Fourth Quarter and Fiscal Year 2022 Earnings Call. We hope that you and your families are safe and in good health. We have with us our Chief Executive Officer, Ronojoy Dutta, and our Chief Financial Officer, Gaurav Negi, to take you through our performance for the quarter. Wolfgang Prock-Schauer, our Chief Operating Officer, Sanjay Kumar, our Chief Strategy and Revenue Officer, and Kiran Koteshwar, our Chief Program Officer and Head of Investor Relations are also with us and are available for the Q&A session. Before we begin, please note that today's discussion may contain certain statements on our business or financials which may be construed as forward-looking. Our actual results may be materially different from these forward-looking statements. The information provided on this call is as of today's date, and we undertake no obligation to update the information subsequently. A transcript of today's call will also be archived on our website. We will upload the transcript of today's prepared remarks by day end. The transcript of the Q&A session will be uploaded subsequently. With this, let me hand over the call to Ronojoy Dutta. Good evening, everyone, and thank you for joining us on this. 2022, we reported a net loss of INR 16.8 billion. Excluding foreign currency loss of INR 6.1 billion, our net loss aggregated to INR 10.7 billion. We swung from a profitable third quarter to a loss-making fourth quarter because of around 15% higher fuel prices, around 11% lower capacity due to Omicron and a lower RASK of 2.9%. For the year ended 2022, we reported a net loss of INR 61.6 billion. Excluding foreign currency loss of INR 9.4 billion, our net loss aggregated to INR 52.2 billion. Excluding currency impact, our operating losses reduced by around 18% year-over-year. We deployed around 55% higher capacity and reported around 77% higher revenue from operations in the fiscal year 2022 as compared to the fiscal year 2021. Our financial results for the full year and the reported quarter was severely affected by the pandemic. First by the Delta wave and then by the Omicron wave, which hit us this quarter. Even with these challenges, we served around 50 million passengers in fiscal year 2022, an increase of 62% as compared to fiscal year 2021. Focusing specifically on the fourth quarter, it would be helpful to break the revenue discussion into two distinct periods of six weeks each. The first six weeks saw significantly lower demand because of Omicron. We operated an average of 1,098 flights per day with below average yields. However, we saw a strong rebound in the six weeks starting mid-February once the rate of Omicron infection reduced. During this mid-February to March period, we operated an average of 1,366 daily flights with a strong uptick in unit revenue. While overall RASK in the March quarter reduced marginally by 2.9% to INR 3.97, primarily due to reduction in load factor by 2% as compared to the December quarter. Yields have remained a good story and held steady at INR 4.40. Importantly, this is comparing a seasonally weak March quarter to a seasonally strong December quarter. As per the Official Aviation Guide, IndiGo emerged as the sixth-largest airline in the world and the fastest in terms of growth. We were ranked number four in terms of punctuality worldwide. It is exciting to see IndiGo among the top airlines in the world, both in terms of scale and quality of service. Towards the end of March, the government allowed international scheduled operations. We ended the quarter with over 100 international flights and are currently operating over 90% of our pre-COVID international flights. We also announced a proposed strategic partnership with Qantas Group. This proposal will be the fifth arrangement with an international carrier, along with American Airlines, Air France-KLM, Qatar Airways, and Turkish Airlines. These partnerships will help IndiGo access new markets and a new set of customers. We reported a CASK or unit cost of INR 4.79 for the March quarter, which is 18.9% higher sequentially. This higher unit cost was primarily attributable to adverse movement in rupees, reduction in capacity deployment, and increase in fuel prices. We have just experienced two very turbulent years in our history, and this would be a good time to step back and assess IndiGo's performance. We were hit by three waves of COVID-19, which caused a sharp decline in demand. We witnessed a sharp rise in fuel prices over the last four months. Capacity and aircraft utilization was severely curtailed. We reported large back-to-back losses totaling INR 119.7 billion over the two years. We also experienced a significant strain on our balance sheet. There is no question that we have taken it on the chin in terms of COVID, fuel prices, and operating losses. Now, let us ask ourselves how IndiGo has responded to this crisis. We strengthened our domestic network. We focused on superior customer service to ensure a higher share of passengers. We right-sized our workforce. We improved our yields in an impressive manner. We positioned ourselves for an aggressive international expansion with building connecting traffic at the hubs and negotiating multiple codeshare arrangements. We significantly restructured our fleet to ensure low maintenance costs and low fuel burn, the two key drivers of our costs. We launched new initiatives such as cargo freighters and digital. We strengthened our relationship with the business partners. We restored our free cash balance to INR 76.6 billion. Along with all these operational factors mentioned above, I would also like to highlight that we have exercised continuous improvement in governance, compliance, and ESG initiatives. The problems we have experienced in our two-year performance, such as COVID, fuel, large losses, et cetera, are of course, all cyclical in nature. In contrast, all our responses have been strategic and sustainable in nature. Consequently, I am proud to say we have emerged as one of the top 10 airlines in the world, both in terms of size and quality, and importantly, we're the fastest in terms of growth. Looking ahead, we are blessed to be domiciled in probably the most exciting aviation market in the world. Within that market, we are structurally the strongest player. Therefore, we are extremely bullish on our long-term outlook. We would like to thank our shareholders for their patience during these difficult times and assure them that profitability is very much on the top of our mind. Now let me hand over the call to Gaurav to discuss the financial performance in detail. As you are aware, Gaurav Negi has joined us as a new CFO. Gaurav has been with IndiGo from December 2021. He has vast experience spanning across more than two decades with several reputed organizations, and we are excited to have Gaurav as part of our team. Over to you, Gaurav. Thank you, Ronojoy Dutta. Good evening, everyone. For the quarter ending March 2022, we reported a net loss of INR 16.8 billion. Excluding the foreign exchange impacts, we reported a net loss of INR 10.7 billion. We reported an EBITDA of INR 1.7 billion for the quarter ending March 2022, compared to an EBITDA of INR 20 billion for the quarter ending December 2021. For the year ending March 2022, we reported a net loss of INR 61.6 billion. Excluding the foreign exchange impact, we reported a net loss of INR 52.2 billion, compared to a net loss of INR 63.3 billion for the year ending March 2021. We reported an EBITDA of INR 11.5 billion for the year ending March 2022, compared to an EBITDA of INR 6.2 billion for the year ending March 2021, an increase of around 84% against a capacity increase of around 55%. Some of the key variations of our performance in the March quarter as compared to the December quarter are as follows. Yield for the quarter remained steady at INR 4.40. Reduction in load factors by three points led to a CASK decrease of 2.9%. Our fuel CASK increased by 10.9% sequentially to INR 1.58, driven by an increase in average fuel price by around 11%. Our CASK ex fuel, ex forex for the March quarter was INR 2.91. This is around 12% higher than the December quarter, primarily due to operating at a lower capacity. The update on cash is as follows. We ended the March quarter with a free cash of INR 77.6 billion, a marginal net reduction of INR 500 millllion versus the December quarter. Our total cash as on March 21, 2022 was INR 182.3 billion. On the other key balance sheet numbers, we ended the quarter with a capitalized operating lease liability of INR 316.7 billion, and total debt, including the capitalized operating lease liability of INR 368.8 billion. Our ROU assets at the quarter end was INR 204.4 billion. The demand has picked up well during the latter half of March quarter. Resumption of scheduled international travel will help us improve our margins. Based on our current estimates, our total capacity deployment in the fiscal year 2023 in terms of ASKs will be in the range of 55%-60% higher than our capacity deployed in the fiscal year 2022, which would roughly translate into 13%-17% growth as compared to our pre-COVID fiscal year of 2020. Specifically for the first quarter fiscal year 2023, we expect the capacity to rebound at almost 2.5x the capacity deployed in the first quarter of fiscal year 2022. We are encouraged by the improvement in revenue performance, but currently challenged by an increase in fuel and weakening rupee. In order to address these headwinds, we are taking countermeasures, but meaningful improvement in these two macro drivers will be critical for us to transition back on a path of profitability. With this, let me hand it back to Richa. Thank you, Ronojoy and Gaurav. To answer as many questions as possible, I would like to request that each participant limit themselves to one question and one brief follow-up question if needed. With that, we are ready for the Q&A. Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. An operator will take your name and announce your turn in the question queue. Participants are requested to only use handsets when asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Reminder to the participants, anyone who wishes to ask a question may press star and one. First question is from the line of Binay Singh from Morgan Stanley. Please go ahead. Hi, team. Thanks for the opportunity. Congratulations for a good performance in a very challenging environment. Overall, we are trying to understand how to think about profitability into the coming year. Clearly, in terms of capacity, this will be a record year for IndiGo, and even on traffic side we are seeing very good traction. Could we talk a little bit about how are the yields playing out? Are you able to pass on the cost pressure? Maybe to answer that, if you could share how were your yields in the second half of March quarter? Because I, as I understand that the yield that you've reported also would have been adversely hit by very weak yields in the first half. Could you share us a few thoughts on how to think about profitability? Secondly, the forex loss looks much larger than we anticipated. Could you talk a little bit about that also? Thank you. Okay, how do we get back to profitability? As you said, there is a tug-of-war going on, and the tug-of-war is between, I think, a very good revenue performance and a very challenging fuel and the rupee weakening. And just staying on the revenue side, I think I'm really impressed with what our teams have done on the revenue side, and I congratulate them for doing great work. It's not been easy. It's clearly very—you almost have to hit the point, the sweet spot just right, because you can keep pushing up fares and at a certain point their demand actually falls off. Judging which that point is and just pushing it to the right level, I think, is the sort of science and the art about this. Again, our revenue team is doing a great job. March was the strongest month last quarter. To give you a sense of where the trends are growing, April unit revenue was 6% higher than March. Then May month -to -date unit revenue was again another 6% higher than April, which is what I mean by the revenue guy. To counter and sort of balance that story, though, April fuel prices were 11% higher than March, and May's fuel prices were 6% higher than April. You have a tug-of-war, but the key to profitability is to keep managing our business on the revenue side. Of course, costs need to be under control, that's always said, but we won't save ourselves into profitability. We have to get it from the revenue side. At the same time, hopefully we get a break on fuel and the rupee. Did I answer your question? Sir, just to give us an idea, what was your March yield? Do we have a monthly breakup of yields? Just so that we can understand better, what are the yields trending in absolute sense? We'll give you. What was the March yield again? We'll find that in a second. While we're looking for it, Gaurav, you want to talk about the forex? You had a question on forex, right? Why it's so big. Yeah, Binay Singh, on the Forex front, the impact has been around INR 600 crores. Now, that's largely because the rupee has weakened approximately 2 points between December and March. A large chunk of the Forex impact that you're seeing is mark to market. Given that the balance sheet that we have is close to INR 300 crores of capital leases that we have, that will give you that, we've got a INR 600 crore effect impact coming in the quarter, largely because the rupee weakening by 2.714. Okay. Sanjay just tells me that the March yield was 5.14. March was 2.71%. Sorry, one minute. April was 5.14%. April was 5.1%. March was? 4.7%. 4.7%. Binny, I hope you're done with that. Next question. Thanks, team. I'll come back in the question queue. Thank you. The next question is from the line of Deepika Mundra from JP Morgan. Please go ahead. Good evening and thanks for the opportunity. Just following up on yield. March 4.7%, April 5.1%. What would be how much of the delta would be potentially from the reopening of international flights? Well, we don't want to get too much into detail now. I already feel like I've given too many numbers. Look, international. I can say the international profitability has been stronger than domestic, and it always is. That's the good news. I don't want to now break up yields into domestic versus international. The significant capacity increase that you're planning for next year, could you give us a sense as to how much of that skew is again towards international versus domestic? I can only give you our long-term trajectory on this. Short term, as you can imagine, there's a lot of volatility. For example, Sri Lanka is a problem. It's not opening as fast as we'd like. China is absolutely closed. There'll be some sort of start, go through the process. Overall, pre-COVID, our capacity was 25% of our system. Our projection is that in five years from now, international will be about 40% of our system. International will be growing faster, but, the rate of growth will very much depend on how markets open up separately or individually. Understood. If I may just sneak in one more. The codeshare agreements, how do they pan out in terms of profit dynamics, as compared to flights run singularly by IndiGo? The key to making money on codeshare is prorate agreements. Every time a passenger from KLM or Qatar or anyone gets on our flight, the question is, what sort of prorate are we charging them, and how do we compare to our alternatives? We have a good position in the marketplace as you know, and therefore are able to negotiate quite attractive prorates, and therefore we're excited about our codeshare agreements. Okay. Thank you so much, and good luck for next year. Thank you. We need it. Thank you. The next question is from the line of Mitul Shah from Reliance Securities. Please go ahead. Good evening, sir. Thank you for giving me opportunity. Sir, the way rupee movement is happening in this quarter in April and May, even slightly sharper than the previous quarter, then which implies that the losses could be like INR 700 crore-INR 800 crore this quarter. Is it a right understanding or even more than that? We know that. Look, I don't know how investors generally look at above the line and below the line. We are trying desperately to be profitable above the line. If the rupee keeps going as it's going, and then we have this big mark-to-market correction, then below the line we take a big hit. Yeah, as the rupee depreciates further, you can expect big mark-to-market adjustments. Sir, my second question is on what is the kind of a feedback or you people are experiencing after sharp price hike on the ticket side, ticket price increases? What is the response on the customer side? Still the affordability seems to be reasonable, or do you think or do you feel any negative, sizable, noticeable negative impact on the traffic side? Clearly, it's a balancing game. If you see the customer resistance to higher prices, you see it on the load factors, right? I wish our load factors were higher than they are, and they're not because, yeah, we are getting some resistance. At the same time, the fact that we are getting unit revenue up, which is what's important. It doesn't matter whether you take it on yield or in load factors. You want the unit revenue to keep going up, and we're doing quite well on unit revenue, and you see it in the performance. There'll be load factor pressure as we increase prices. No question. Lastly, after this capacity utilization and capacity increase for FY 2023, whichever number you indicated, so would that be close to pre-COVID level or even higher, or still it will remain below pre-COVID level? We are already higher than pre-COVID level. With the- Like we said, it's gonna be close to 13%-17% higher. Okay. Yeah. Thanks, sir. I mean, through all these questions, I just have to emphasize, the revenue performance has really been good, and I would say surprisingly good. Thanks again to our commercial team. They're doing a great job on the revenue side. As you alluded, with the customer pressure, with the customer resistance, my God, these fares are going up. We have to keep surviving. With fuel doing what it's doing, we have to raise fares. As you've said many times, India has the lowest fares in the world. I hope that the fares are sustainable in the long term. We do need to have higher fares. With fuel and the rupee really are a problem. Right. Yeah. Understood, sir. Thank you very much. Thank you. The next question is from the line of Chintan Sheth from Samiksha Capital. Please go ahead. Thank you for the opportunity. Am I audible? Mr. Sheth, sorry to interrupt you. The audio is not clear from your line. Am I audible? Yes. Hello. Sir, on the capacity again, with industry getting consolidated and new players are trying to get, start their operations and our plan of very strong capacity addition next year, what's your take on yield? How it will pan out? The industry has been behaving quite rationally, I'm used to say. We do have a lot of players already, and everyone recognizes with the fuel doing what it's doing, with the large losses we've incurred, we all need to repair balance sheets. I am hopeful that the new players are actually seasoned players. If you look at the management team at both, Akasa and, Jet Airways and so forth, they're seasoned players. I expect that the rational behavior will continue, and we wouldn't see any crazy price wars or anything like that. Second on small bookkeeping, sequentially, we see OpEx as well as employee costs rising. I understand that we must have planned for better capacity, but because of Omicron, we kind of need to pull back our capacity, and that resulted into timing-wise, rationalizing our cost. Going forward, what kind of run rate we should look at? If you can throw some light on that. You're talking of employee costs specifically? Yes. Yeah. Sequentially, it has increased both employee costs and other OpEx. I'm just trying to understand how should the trajectory look like? Employee costs, clearly, we have some snapback in wages, and it's not over yet. As you know, for example, pilots, we've given 8% and promised another 6.5% in November, and we'll keep looking at those numbers and as profitability improves, we will be doing some pay raises along the way. Yeah, wage rates will go up. As far as productivity goes, that's where our emphasis is. In every department, from flight crews to operations to commercial, we're looking at employee productivity and trying to sort of manage that as best as we can. At the absolute pay rates, yes, you would expect them to go up in an inflationary environment. Any numbers in terms of ASK or the percentage growth or? No, no. I mean, it's a very delicate and, again, just like we said, we have to manage revenue very carefully. We have to manage this also very carefully. We have to be absolutely conscious of the fact that our employees are facing an inflationary environment and that we need to give pay raises. We are very conscious of the fact that they've all worked very hard through two years of COVID. At the same time, we need to keep an eye on the profitability of the company as well. It is a balancing act, and I wouldn't like to give any forecast. That expense from INR 742 crores to INR 834 crores sequentially? Again, sequentially, we had a one-off in Q3. Excluding that, there have been some increases in OpEx costs, in line with some of our increases that we've seen in international operations. That is driving some of the cost up. Again, to Ronojoy's point, in terms of as a percentage of ASK, that's what we'll be focused on. We try to keep it lower in terms of as a percentage of ASK versus just looking at an absolute number. Okay. Sure. Okay. Thanks. Thank you. The next question is from the line of Arvind Sharma from Citi. Please go ahead. Yeah. Hello, greetings, and thanks for taking my question. First question, sir, would be on a fleet strategy. When you give that number for ASK, is there any fleet number in mind? Because on a quarter-on-quarter basis, your absolute amount of planes have gone down. Is there any number that you have in mind for FY 2023 in terms of fleet expansion? Part of the reason why our capacity is going up because we have such a large number of A321s coming. I mean, it's become a very significant part of our fleet. As you said before, our overall fleet count won't change much. It'll be roughly flat, but the capacity will go up because of higher density. Thanks, sir. That's helpful. Secondly, sir, I think this has been in a way alluded to in previous comments. The fares have risen quite sharply, but still demand is holding on. Where do you think is that inflection point where anything beyond that in terms of increase in fares would start impacting demand negatively? This is a balancing act, and it's a day-to-day activity and almost minute-by-minute activity. We have to just watch the loads carefully. Our job is to maximize the revenue on each flight. Whether it comes from load factors or yields, we're sort of agnostic to that. But we need to push revenues per flight up, and that's what we are focused on doing. Within that, I would say that our customer service is very, very strong. If we have a strategy on customer service, it's almost like we want to make sure that the customer has to almost ask themselves, "Why would I make a mistake of not booking IndiGo?" Through the entire process in the front end and in the back end. In the front end, we make sure we give more frequencies, more connectivity, so the customer wants to book us. When they fly us, we make sure we provide reliable service. We are courteous. Even after the travel, we want to build trust with the customer. If you lose your bag, if you need a refund, you can trust IndiGo to do it just right. Part of our revenue strategy is just build great customer service and make sure you get a disproportionate share of the industry revenue. Sure. Thank you so much, sir. If you go to the reforms on the same lines, does the floor and the ceiling on the fares still exist in terms of the regulatory? Very much so, yes. You don't expect it to go away, so you expect that big disturbance in the 15-day window and beyond to stay for some time? Hard to tell. Right now they're here, and we abide by that. Thank you so much for taking my question. Thank you. The next question is from the line of Aditya Mongia from Kotak Securities. Please go ahead. Good evening, everyone, and thanks for the opportunity. My first question was on the growth that you emphasized for the air traffic in general. If the yields kind of stick around the INR 5 or higher mark. I'm just trying to get a sense whether the past growth rates can still be repeated after, let's say, one year is done? Or should one structurally start thinking about lower growth rates for the sector? I'm not sure I understood your question exactly, but you're saying at higher yields do we expect the growth to continue. Look, let's do total industry revenue. As we know, industry revenue roughly grows twice as fast as the economy. The fact is there is pretty strong growth in the economy. We had a downturn, but then we recovered nicely. You look at all the parameters such as GST collections and all that, it tells you, hey, the industry, the economy is fairly strong. As long as the economy is strong, we expect industry revenues as a whole to grow. Now, whether we take it again in yields or in volume is up to the rational players in the industry to decide. Clearly, with high oil pricing, you can't take it in volume, you have to take it in yields. That's where we are as an industry. As in, just to kind of clarify this more, let's say the period from 2010 to 2020 saw air volumes growing at 3x GDP, almost 3x GDP. Yes. The question that I'm asking is that with yields having made such a big jump up, should one start thinking through lower multiples to GDP growth for air traffic growth from here on? Let me clarify your question. When we say it's a multiple of GDP, we're talking of revenues. Yes, at a certain period, revenues might have gone up 3 x. Revenues across the world, whatever the GDP is, the revenue will grow around 2.5 x. That's the norm. Within that, the industry players can say, "Okay, I have this much of revenue coming. Do I need more volume to be pushed or do I want yields to remain high?" That will depend on all players and their individual behavior. The total revenue growth will not slow down. It will be 2 x, 2.5x the GDP growth. That clarifies. The second question that I had was more on the ability of better placed airlines like IndiGo to earn slightly more on a relative basis. Now, with the yields already being so high, are the opportunities to price your offering at slightly higher rates becoming easier or more difficult? In my view it's about the same. Look, our yields are better than the industry, right? They're increasing faster than the industry. The question is why? Maybe your secondary question is that sustainable? Why are our yields growing faster than the industry? A number of factors. First, I'll start with the network. Our network has more penetration, our network provides more frequency, and importantly, our network provides better connectivity. If you're going from point A to point B, there might be six airlines flying it, but IndiGo through its connectivity gives you far better options than anyone else. Morning, afternoon, evening, we give you all the options. Our connectivity is a huge reason for customers to book us over everyone else. That's one. Second, as I said, is overall service, reliability, et cetera. Third is, I would say trust. Whether we have a disruption, we have a plan B. If we have a refund to be made, we are very, very diligent in making sure, "Hey, let's not hold onto a customer's money. Give it back fast." If your bags are lost, I tell you, we have a team that's like aces. They go around finding lost bags, lost backpacks, lost laptops. So this whole package of network, customer service, trust, all this builds into high yield. That's why yields are going up. Yeah, I believe they're sustainable. Thank you. Mr. Mongia, may we request that you return to the question queue for follow-up questions. Next question is from the line of Achal Kumar from HSBC. Please go ahead. Yeah. Hi. Thank you for the opportunity. I have two actually. One, Mr. Dutta, if you could please take a slight deeper dive into the network. Basically, if you could talk a little bit more about how the metro to metro routes are performing, how metro to non-metro are performing, where the yields are high, and how the competitive landscape looks like. Because everybody's sort of trying to enter metro to non-metro because there the yields are much better. I mean, fair enough, we can understand that. But with the rising competition, of course, there'll be a yield under pressure because the demand has not developed fully there. Similarly, with domestic versus international, how do you see the international? Because fares are very competitive. On Dubai you are flying for INR 14,000. Emirates is also flying for INR 14,000. Looks like the competition is very high. If you could take a deeper dive into the network. Secondly, on the inflation side, of course inflation is rising, and there was a unhappiness between your employees about the salary increase, especially in the pilot space. Then with the rising inflation, that actually could grow. How do you see the situation there? What sort of things you need to do? Would that add pressure to the cost? These are two questions to talk about, please. Okay. First on the network. The network, as you know, and this is not new, there has been a shift in the sense that like three, four years ago it was all about, oh, metro to metro is so profitable. They are our best routes and everyone's like piling into metro to metro. That has clearly changed. Metro to metro is still strong, but metro to non-metro, as you said, is getting stronger. Now, within metro to metro though, a huge part of it is corporate travel. I'm pleased to say that corporate travel is coming back. Yes, we took a sharp hit, but everything says they're coming back and therefore metro to metro profits are also increasing. Metro to non-metro, we have a lot of unique stations that we've gone into, therefore we have a lot of unique segments and so that by itself is good. Within that also, metros are so well-positioned, that if you're going from. I'll just make this up. If you're going from Bhubaneswar to Surat, we give you six different ways of getting there at five different times of the day. That's a huge advantages for us in terms of yield. If you look at pricing then, usually everyone prices to match. 90 days out everyone has matched, 60 days out everyone has matched, and then 15 days out everyone's matched. The question is, which airline is getting a higher proportion of the 90-day pricing and which airline is getting a higher proportion of the 15-day pricing? That's where advantage comes in. Because of everything that I mentioned, service, network, et cetera, we tend to get more of the 15-day pricing. All of this is a network yield game and the sort of unique strong network results in the high yield. International, yes, the markets to the Middle East are very strong for everyone, I'm sure. Now, within that, what are our advantages? You mentioned Emirates. Well, Emirates will have a certain number of seats, but they are looking at more towards the beyond. So they are pricing in such a way as to get more and more of the beyond connection. We are pricing in the local market. That's where we have a strength with the narrow body. We do quite well and therefore the Middle East looks good. I think that's what you asked me on international specific. Now, I'll switch to the employee side. Look, our overall strategy is engage with the employees, focus on the employees. If we do that, the employees in turn will focus on the customers. If they do that, the customers in turn will create shareholder value. It really is a chain of doing everything right for the employees, not just pay in terms of working conditions, you know, engagement, all of that, so that we get better customer service, so that we get shareholder value. We are in an inflationary environment. We've gone through a very difficult period, first of pay cuts and then not full restoration of pay. We know we have to address this issue. As they say, we do have a big loss. As much as we'd just like to give everyone a pay raise, we have to take into account the sort of losses that we are piling up. We have to manage this very carefully. I'll say this, our heart is with the employees. We want to do the right thing for them. We'd love to give them more pay raises, our heart is with them, but our head has to work in terms of let's be profitable. Overall, I think our employees have been resilient. I think they're extremely loyal. We take all these surveys and I think they understand. Again, it's not an easy walk in the park. It's something we have to manage very carefully, but we'd like to do the right thing for our employees. Right. Sorry, Mr. Dutta. Actually, Emirates was an example which I referred to. I wanted to understand the overall international network on the Southeast Asian countries, on North Asian countries and all. This was just an example which I got. Okay. Let's talk of our international strategy. Fact is, India is surrounded by strong hubs, which carry a lot of connecting traffic. What we have discovered through the COVID-19 process is the incredible amount of charter demand we got for point-to-point. We're like, "How did these people get to these before COVID-19 and the shutdown and so forth?" The answer is they all went one-stop. Well, if there's so many one-stop, we obviously have a unique opportunity to go nonstop. I'll just make up some example. Let's say you're trying to get to Bali or you're trying to get to Manila or you're trying to get to Hamburg. How do you get there? Well, you get a one-stop on someone, with a three-hour stop layover, et cetera, et cetera. We want to do all this nonstop. We're looking for all these opportunities. COVID-19 has given us a great learning and feedback into our insights into markets, and we're eager to go as soon as we have some more aircraft available. Right now we're quite hungry for aircraft. As I said before, our count is not going up. We'd like to increase the count. I also want to stress the code share applicability to all of this. You look at Doha, you look at Istanbul, all these connections where the other side is flying passengers and then connecting to our network, that's a very profitable business for us as well. International has always been margin-wise better and will continue to be margin-wise better. To Southeast Asia, we have more challenges right now, but I think it's temporary, whether it's Thailand or Malaysia. Softer to build up, but I think we'll do fine. Thank you. Mr. Kumar, may we request that you return to the question queue for follow-up questions. The next question is from the line of Mohit Adnani from Crisil. Please go ahead. Yes, thank you. I want to understand, has the booking curve sort of expanded than before? Because I remember hearing one of the conference calls that because the pandemic in FY 2021 and FY 2022, India had moved from already a shorter booking cycle to even shorter because people are not sure what the condition would be. But do you see it going back to pre-COVID levels now or even, say, further? Because in the D15, fare cap is still there and fares are high. Are you seeing people booking more in advance than before? Yeah. The booking cycle has almost become the same as it used to be the pre-COVID level, and we are seeing almost a similar kind of booking patterns. More so with the 15 days, pricing which is right now currently enforced by the government. We are seeing the booking cycle getting back to the pre-COVID level. What is also happening is on the international side we are seeing even better than the pre-COVID level as far as advance bookings are concerned. We are seeing a higher percentage of the people booking in advance, 30 days out, compared to what they were doing prior to COVID. Okay. I just had a quick follow-up. Not exactly a follow-up. I want to know that with three recent incidents of the CFM engine having shut down and the DGCA having taken notice of that, do we foresee any delay in receiving the new A320neos, which are gonna be powered by the CFM engines? It won't come here. No, we don't foresee any delays in how the aircraft are delivered to us. I have to say in operations, as we have that scale of operation, an engine shutdown is a normal case of not normal in the way that we want to have it, but it happens from time to time. There are clearly statistics that show that, but our crew is trained, our pilots are trained to handle such situation, and we don't foresee any changes in our fleet planning with this. Thank you very much. Thank you. The next question is from the line of Pramod Kumar from UBS. Please go ahead. Yeah, thanks a lot for the opportunity. My question relates to the cargo business, sir. Mr. Kumar, sorry to interrupt you. Please use the handset mode. The audio is not clear. Sure. Is it better now? Yes, we are. Yeah. Thanks a lot. My question is pertaining to the cargo side. Given the recent announcement of a 50% joint venture with UPS, just want to understand some more details about it. In terms of whether does it kind of you know over and above your own freighter plan? And also is there any overlap for your existing the freight belly carry on the passenger aircraft? Will it be also part of that joint venture? To begin with that, and I have a follow-up on the cargo side. First of all, the cargo arrangement between UPS and the InterGlobe, that has nothing to do with us. That's a standalone operation. They have their own agreements which has no impact on IndiGo whatsoever. We of course carry UPS. We serve, not carry. We serve UPS, we serve FedEx, we serve DHL. We are neutral to all of those, and we try to do our best as we can by each one of those providers. On our own of course, we are quite bullish on the cargo business. As you know, we have four freighters coming, and cargo has done very well through the COVID period and we expect that to continue. There's no relationship at all between what we are doing on the cargo and what InterGlobe Group is doing on their side. That's good, Ronojoy, for you to clarify because I was wondering why there was no exchange filing from your side to this effect. In a way it's kind of a promoter is driving this business separately with UPS. Ronojoy, isn't there a bit of a issue then because IndiGo itself has its own freighter plans and so isn't there a bit of a issue there in terms of both promoters, promoter group companies competing for the business? I'm just a bit surprised. As I said, this will be totally arm's length. We do business with the UPS, we do business with FedEx, we do business with DHL, and we continue to do that. They have their own relationship. It really has no overlap, nothing to do with us. No sort of tentacles between the two companies. Thank you. Mr. Kumar, may we request that you return to the question queue for follow-up questions. Next question is from the line of Iqbal Khan from Edelweiss. Please go ahead. Yeah. Hi, sir. Am I audible? Yes. Yeah. Hi. Sir, I mean, talking about the cargo portion as well. Can you please tell me, I mean, how much was the cargo revenue for this quarter? Like, if I'm not wrong, last quarter it contributed around 20% of the total mix. So can you just give me the number on that? And how do you see the corporate travel, corporate travel recovering? Has it been 100% of pre-COVID levels now? This is my first question. I'll let Sanjay address the corporate travel. On the corporate travel side, we have seen complete recovery of the pre-COVID level, at par with the pre-COVID levels, especially. Okay. In the month of March, we had almost 64% of recovery taking place on the corporate travel side. Now last two months, especially in the month of April and May, we are seeing pre-COVID level or even higher traffic than the pre-COVID levels. Going forward, I think we are quite bullish about the corporate recovery as well as the business growing from the pre-COVID levels. Okay. With cargo, our year-over-year numbers show 31% growth. As I said, cargo is strong and all the signs are that cargo is going to be very strong going forward. How much was it in the overall revenue mix in this quarter? I don't need me going to that level of detail. I'm sorry. Okay. Sir, just one. You mentioned that the capacity addition in first quarter was 2.5x of the Q1, FY 2022. Is that correct? Is this what I heard? Yes, that is correct. How much would you anticipate for the entire financial year 2023? We gave that number. What was it, Sanjay? We'll be around 50%-60% higher than what we closed 2022 with. Okay, cool. Thank you, sir. That answers my question. Thank you. The next question is from the line of Pulkit Patni from Goldman Sachs. Please go ahead. Sir, thank you for taking my questions. Sir, my first question is on yields. We've obviously got that you know floor price, which is just something that is supporting us. I guess there should be some charters as well. Just to get a sense, how much do you think of the yield that we are getting today could have a bit of artificial support because of these factors? Or do you think these yields are absolutely pure yields, and even if the support goes, it shouldn't have an impact? Anything that you can quantify there would be pretty helpful for us. That's my question number one. Okay. Look, the pricing bands have a floor and they have a ceiling. For a long time, we were all sitting on the floor. Prices were doing what they were doing, but we were all sort of managing at the floor. Now they've come sharply off the floor. They haven't hit the ceiling at all or anywhere near it, so there's still room to grow. But they are sort of now in between the ceiling and the floor. Look, it's impossible to give a scientific answer. You can only give a gut feel answer. My gut feel is that the Indian economy is strong, that there has been a structural shift in the way people think of air travel. People travel more. People who could afford it are spending more on travel and vacations, getting together with family. People before who couldn't afford it now can afford it. Some of them can afford it because income levels have gone up. Some of them can actually afford it because their employers are now paying for it. Some of them just sort of do a trade-up mentally of, "I'm going from Jaipur to Chennai, and I can lose four days wages by train, or I can pay a slightly higher fare on IndiGo." I think there's a big structural shift of more people flying more often and substitution of air versus rail. I think this not only is sustainable, I think it's, we've just seen the beginning of this phenomenon. There's a long way to go in this. Everything that I've said, yeah, it's starting off, but boy, it's got a long way to go. I'm very bullish on aviation traffic and yields in India. Sir, international charters, does this still form part of the. It's fewer and fewer. As internationals opened up, we've moved from charter to schedule. But international, again, there's a lot of room for growth. I mean, again, as I keep saying, look at the traffic between Milan and Delhi and how the hell does it get here? Well, not nonstop on anybody. It's all coming through Doha and Dubai and whatever else. It's like, come on, let's get a plane and fly Delhi-Milan. There's lots of opportunity here on this. Sure, sir. My second question, more of an observation. I mean, to one of the previous questions you mentioned that this UPS JV is with the IGE group. The fact that we are also getting into cargo, getting dedicated freighters at a time when this is a joint venture with the promoter, I mean, isn't that conflict of interest? I mean, if you could just explain this, how would it eventually work? Because obviously we were very bullish about cargo, which we are focusing on as a company. At that time the JV happened with the promoter company. If you could just explain that a little better, it'll be helpful. There's absolutely no conflict here. We have, I don't know, 100 shareholders. Each of them do their own things. Now, if one of our shareholders wants to get into the cargo business, another shareholder wants to get into the shipping business, what concern is it of ours? What does that shareholder expect us to do? Nothing. Just ignore them. We'll do our thing. They'll do their thing. Also, again, I don't know exactly what this is, but just knowing UPS, I'm guessing they'll focus more on small shipments and certain travel, I mean, transportation. We won't. We're looking at consolidated shipments, probably going international. Hey, it's like two ships passing in the night. We have nothing to do with each other. We don't signal each other. We just ignore each other. We may request that you return to the question queue for follow-up questions. The next question is from the line of Joseph George from IIFL. Please go ahead. Thank you. Is the audio clear? Yeah. Sure. Thank you. I have three questions. Firstly, you know, what is the impact of rising interest rates on lease rentals? That is one. Second is when I do the math with respect to utilization rates, expected utilization rate of aircraft for FY 2023 based on the fact that you're guiding to a 55% growth in ASK without a significant increase in fleet size, it comes to about 11 hours. I want to understand whether there is scope to increase this further. Given that your international shares as we go ahead will increase compared to your own history, whether there is scope to increase the utilization beyond what we have seen in the past. That was the second question. I'll take the third one after maybe the responses of first and the second. Aircraft utilization. Very good question. Yes, a lot of the growth is coming from increased utilization. Part of this is a domestic international mix. The great thing about the domestic international is domestic flies during the day, international flies during the night. It just works beautifully for us. If there's an objective target, feasible number we're shooting for, we'd like to be at about 13.5 hours utilization, and we are a long way from there. A big part of this all year-over-year growth is so high and 70% growth and all that. A lot of it is just surely coming from utilization. Your next question, what is the impact of interest rates on leasing costs? Clearly, there is a correlation. As of date, we see still not large numbers where we see an impact, and we are sort of booked far out. It's not like we're doing leasing transactions for next year's deliveries. We are booked far out. Those deals are sort of done and sealed and signed. For next few years at least, we have no issues. Your point is well taken. If interest rates go to 16% or some huge number, would there be an effect on leasing? Of course there will. We're not seeing anywhere near anything like that yet. No, understood. Just to get a clarification. The current lease rentals are all locked in at a particular interest rate, not governed by variable rates. I don't want to say all or nothing. Most of them during active negotiations. We don't do leasing arrangements for the next six months. We do them two, three years out. Yeah, a huge bulk of them are all done. Understood. The last question that I had is, you know, you've guided for a 15%-16% growth in ASK. That number sounds, you know, very good because we're going to be much higher than pre-COVID levels. I want to understand what is the confidence level, on maintaining load factors and yields. I mean, increasing capacity by 50%-60% is one thing, but doing that while maintaining load factors at optimum, levels maybe north of 80% and, sustaining high yields, how do you see that playing out? Again, it's a full package that I want to talk about. I'll repeat everything that I said in different questions. Indian economy, very strong. Indian aviation, lots of opportunities around us internationally. IndiGo's position in terms of high customer service and therefore disproportionate share of revenue, very strong. The dynamics of the Indian aviation of more people traveling, more people traveling more frequently, more people willing to pay a higher price, very strong. When I put those all things together, what is the confidence level? Very, very high. Got it. Thank you. Thank you. Ladies and gentlemen, that was the last question for today. On behalf of IndiGo, that concludes this conference call.