Airlines are likely to experience a traffic growth of 22-23 %, making it one of the best for the sector this financial year, even though oil prices created substantial pressure.
“Airlines are maintaining healthy load factors backed by low fares. But since oil prices are on an uptrend, impact on profitability in Q4 is inevitable as average ATF price during the quarter are 37.9 percent higher YoY, while the yields continue to remain under pressure,” says an Icra report. The fuel cost per ASKM increased to Rs 1.16 in January from a low of Rs 0.82 a year ago, and the same is expected to increase further in February and March, according to
The fuel cost per ASKM increased to Rs 1.16 in January from Rs 0.82 a year ago, and the same is expected to increase further in February and March, according to Icra. Despite higher prices, airlines saw a passenger load factor of 84.4 percent during the first 10 months of the year, which is also one of the best amongst the key markets in the world. The PLF stood at 88.3 percent in January.
The graph of domestic fliers in the last five years is 12.9 per cent, 5.3 per cent, 4.6 per cent, 15.5 per cent and 22.1 per cent, and the industry is likely to surpass the last year growth rate, making the domestic market the fastest growing in the world.