A recently report by credit rating agency ICRA has stated that domestic air passenger traffic grew by 13 per cent to 15.4 crore in 2023-24, while the aviation industry's net loss is expected to be around Rs 3,000 to 4,000 crore during the same period. Icra noted that the airlines' ability to raise yields proportionate to their input cost increases will be key to expand their profitability margins while supply chain challenges and engine failure issues pose near term headwinds.
"For FY24, it said domestic air passenger traffic is estimated at around 154 million. The domestic air passenger traffic in FY2024, thus, surpassed the pre-Covid levels of around 142 million in FY2020. For March 2024, domestic air passenger traffic was estimated at around 135.2 lakh, around 6.9 per cent higher than around 126.4 lakh in February 2024. Further, it grew by around 4.9 per cent on a YoY basis," Icra said in a report.
The report further noted that the country's aviation industry is expected to report a significantly lower net loss of Rs 30-40 billion in FY2024 and FY2025 over Rs 170-175 billion in FY2023.
In March, the airlines' capacity deployment was higher by around 2 per cent compared to the year-ago period and about 9 per cent as against February.
For the 11 months ended February 2024, the international passenger traffic for Indian carriers stood at around 270.1 lakh, a YoY growth of around 25 per cent, and higher than the pre-Covid (April-February 2020) levels of around 218.1 lakh by 24 per cent.
The rating agency said it has a stable outlook for the aviation industry amid continued recovery in domestic and international air passenger traffic, and relatively stable cost environment and expectations of the trend continuing in FY2025.
India is one of the fastest-growing civil aviation markets in the world.
Last week, aviation consultancy CAPA India noted that domestic air passenger traffic is estimated to be around 153.4 million in 2023-24. For international traffic, the consultancy had pegged the figure at 70 million in October 2023, lower than 72-74 million estimate made in March last year.
(With PTI inputs)