India-Pakistan crisis: Turkish Airlines share price crashes 10% in one month

India-Pakistan conflict: In the last one month, Turkish Airlines share price has plummeted 10% as the Turkey's tourism industry is reeling under the effect of the India-Pakistan conflict.

Turkey's public support for Pakistan after India's military operation, titled Operation Sindoor, against terrorist installations in Pakistan and Pakistan-occupied Kashmir, is costing the country that witnesses significant tourism from Indians.

MakeMyTrip, earlier this month, said flight bookings to Turkey have dropped by 60% in the last one week and cancellations surged by 250% as Turkey's pro-Pakistan stance sparked widespread cancellations from Indian travellers to the country.

According to Nishant Pitti, Founder and Chairman of EaseMyTrip, more than 2.87 lakh Indian tourists visited Turkey in 2023, up 25% year-on-year (YoY) from 2.3 lakh visitors in 2022. He also estimated the spend per Indian tourist in Turkey to be between $1,200–1,500 (approx ₹1,02,600-1,28,200). Further, the total estimated Indian tourist spend in Turkey in 2023, according to Pitti, was between $350–400 million (approx ₹3,000 crore).

Turkish Airlines shares crash 10%

Against this backdrop, Turk Hava Yollari AO or Turkish Airlines shares declined from 312.75 Turkish Lira to 280 Turkish Lira today, May 27, shedding 10.47% during this period.

“Turkish Airlines' share price has been under pressure due to the recent cancellation of flights for Indian tourists. Fresh bookings from India to Turkey also hit significantly after Turkey stood with Pakistan after Operation Sindoor. Hence, the market is discounting the business loss that the aviation company is expected to incur in the upcoming quarters,” Avinash Gorakshkar, Head of Research at Profitmart Securities, told Mint.

As many Indian tourists visit Turkey, the aviation stock may see more downside, predicted Gorakshkar, following the quarterly results announcement, as the company's guidance is expected to remain muted in the upcoming quarters.

Turkish Airlines: Stock outlook

Anshul Jain, Head of Research at Lakshmishree Investments, commenting on the technical outlook for the stock, said, “Thyao has given a failed breakout from a 45-week-long rounding pattern at 331 Turkey Lira and is now unwinding trapped longs. The breakdown signals a structural failure, and the ongoing decline suggests bearish momentum may intensify.”

He added that bears will initially target the pattern low of 257.5 levels. A decisive breach below this support will likely open the gates for a deeper correction toward 230, Jain predicted, adding that until then, the stock remains under pressure and should be avoided for fresh longs.

Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.