Domestic air traffic marginally came down in April: ICRA

by Utkalika Mohanty

NEWS HIGHLIGHTS

The domestic air passenger traffic last month marginally came down to about 132.8 lakh from about 133.7 lakh logged in March 2024, said ICRA in a research report.

Chennai, May 10: The domestic air passenger traffic last month marginally came down to about 132.8 lakh from about 133.7 lakh logged in March 2024, said ICRA in a research report.

ICRA report also said the domestic aviation industry is likely to close FY25 with a net loss of Rs 30-40 billion in FY2025.

According to the report, the April 2024 domestic air passenger traffic was higher by about 3.1 per cent on a year-on-year (YoY) basis and by about 21 per cent than pre-Covid levels.

For FY2024, domestic air passenger traffic was about 154 million with YoY growth of about 13 per cent, in line with its estimates, ICRA said.

The domestic air passenger traffic in FY2024, thus, surpassed the pre-Covid levels of about 142 million in FY2020.

Further, for FY2024, the international passenger traffic for Indian carriers stood at about 296.8 lakh, a YoY growth of about 24 per cents, and higher than the pre-COVID levels of about 227.3 lakh by 30 per cent.

In line with ICRA’s estimates, the international passenger traffic for Indian carriers in FY2024 also surpassed the peak levels of about 259.0 lakh in FY2019 (April-March 2019), the ICRA report said.

According to the report, the domestic aviation industry witnessed improved pricing power, reflected in the higher yields (over pre-Covid levels) and, thus, the revenue per available seat kilometre-cost per available seat kilometre (RASK-CASK) spread of the airlines.

ICRA expects the momentum in air passenger traffic seen in FY2024 is expected to continue into FY2025, though the further expansion in yields from the current levels may be limited.

As regards the recovery in the airline earnings, ICRA says it will be gradual owing to the high fixed cost.

The industry reported a net loss of about Rs 170-175 billion in FY2023 due to elevated aviation turbine fuel (ATF) prices twined with the depreciation of the Indian rupee against the US dollar.

ICRA expects the Indian aviation industry to report a similar net loss of about Rs 30-40 billion in FY2025 as seen in FY2024 as airlines continue to witness healthy passenger traffic growth and maintain pricing discipline.

Be that as it may, ICRA said the industry is facing supply chain challenges and issues of engine failures for the Pratt and Whitney (P&W) engines supplied to various airlines.

In FY2024, Go Airlines (India) Limited grounded half of its fleet due to faulty P&W engines, which led to the stalling of its operations. InterGlobe Aviation Limited (IndiGo) had also grounded more than 70 aircraft due to P&W engine issues, as of February 2, 2024, including an issue from powder metal (used to manufacture certain engine parts) contamination with its P&W fleet,” the report notes.

According to ICRA, as per estimates, 24-26 per cent of the total fleet of Indian airlines in operations was grounded by March 31, 2024.

Considering the bulk recall of the engines globally by P&W and other existing issues with the OEM’s engines, the testing by P&W is likely to take longer at 250-300 days.

This will result in high operating expenses towards the cost of grounding, an increase in lease rentals due to additional aircraft being taken on lease to offset the grounded capacity, rising lease rates and lower fuel efficiency (due to replacement with older aircraft taken on spot lease), which will adversely impact an airline’s cost structure.

However, healthy yields, high passenger load factor (PLF) and partial compensation available from engine manufacturers would help absorb the impact to an extent.

“In the current fiscal, the industry has also faced challenges related to the availability of pilot and cabin crew, leading to several flight cancellations and delays. In April 2024, Vistara had to cancel some of its scheduled flights, with many experiencing delays as well, due to a shortage of cabin crew and pilots. Further, on May 8, 2024, Air India Express had to cancel over 100 flights due to similar reasons. Such issues impact the capacity availability and add to customer grievances,” ICRA said.

(IANS)

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Incidents Of Violence Mar Second Phase Polls In Odisha

by Hemanta Pande

Bhubaneswar, May 20: Incidents of violence marred the second phase polls in Odisha, even as the state recorded 60.72 per cent voter turnout by 7 pm.

The voter turnout figure is most likely to cross the 70 per cent mark after the final computation following receipt of details about polling statistics from all the booths.

Reports from Bargarh said an auto-rickshaw driver was killed by two persons at Sarsara village while he was carrying some voters on his vehicle to the polling booth. The deceased was identified as Biswanath Mirdha.

Family members of the deceased alleged that it was a political murder executed by the ruling Biju Janata Dal (BJD). Inspector General of Police, Himanshu Lal said the murder took place because of “personal enmity” between the deceased and the accused.

Local BJD assembly candidate Debesh Acharya said the reason behind the murder will be ascertained after the police investigation.

The broad daylight killing sparked tension in the area for quite some time. The family members of the deceased and others created ruckus and demanded an immediate halt of voting in the village. The police, however, handled the situation quite well by whisking away the family members and other agitated people from the crime spot.

Reports said tension prevailed at Turum village in Ganjam district as a clash erupted between BJD and BJP after alleged booth rigging attempts by BJD workers. The incident occurred at booth no 47 of Beruanbadi village under Turum police limits.

The voting was initially peaceful since morning. However, some BJD workers allegedly entered the booth for rigging. A clash erupted inside the booth when the BJP agents opposed the BJD workers. Irate over this, the BJD workers allegedly attacked the BJP workers. The entire act has been captured on a mobile camera.

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Odisha CM's Office, Residence Under Grip Of Corrupt Coterie: PM Modi

by Hemanta Pande

Bhubaneswar, May 20: Prime Minister Narendra Modi on Monday said that the Odisha Chief Minister’s Office and residence were taken over by "a corrupt coterie" and the backbone of this mechanism would be broken when the Bharatiya Janata Party (BJP) comes to power on June 10.

Addressing public meetings in Dhenkanal and Cuttack Lok Sabha seats after holding a roadshow in Puri this morning, PM Modi launched a scathing attack on Odisha Chief Minister Naveen Patnaik and his close aide VK Pandian.

“A handful of corrupt persons have captured the CM's residence and office. Small workers of the BJD have now become crorepatis," PM Modi said.

The Prime Minister said a mafia in Odisha is controlling everything and not allowing anyone to compete. “Once BJP comes to power on June 10, its backbone will be broken,” he said.

PM Modi said though the state is rich in mineral resources, its people are distressed. He alleged that the BJD government is not allowing the people of Odisha to benefit from the state's mineral wealth.

Stating that Odisha received Rs 26,000 crore from the district mineral fund (DMF), PM Modi said the money should have been spent on roads, schools and drinking water, but the BJD government has misused it.

Raising the issue of Ratna Bhandar, the treasure trove of Shree Jagannath temple in Puri, PM Modi said people are discussing how the keys of Ratna Bhandar have gone to Tamil Nadu.

“When our keys of houses are lost, we pray to Lord Jagannath and find them within one or two hours with the Lord’s blessing. But the keys of Lord Jagannath Ratna Bhandar are missing, and it has been six years now. The report of the commission of inquiry into the missing keys of Ratna Bhandar has been suppressed for six years as the keys have gone to Tamil Nadu," he said.

“The BJD government and those who have captured the Chief Minister are directly responsible for this,” he alleged.

"I assure the people that once the BJP government comes to power, the entire truth will come out and we will make the report public. Our service to Lord Jagannath will begin from this work,” he added.

On raising of paddy MSP, PM Modi said, "Once BJP forms government in Odisha, paddy MSP per quintal will be increased to Rs 3,100 and within 48 hours, farmers will get the money credited to their bank account,"

PM Modi reiterated that a double-engine government will be formed in the state after the elections.

“Vote for BJP, and Modi guarantees that any son or daughter of Odisha will be made the chief minister of Odisha. The dual engine government will be sworn in on June 10 in Odisha," PM Modi said.