New Delhi
Indian airports are finally expected to return to profitability during 2022-23 after the COVID-19 pandemic had disrupted airport operations for the past two years, rating agency ICRA Ltd said in a report on March 28.
According to the rating agency, the resumption of international commercial airline operations and an increase in tariffs will help airport operators report profits in 2022-23.
“Resumption of international commercial operations would accelerate the traffic recovery. Southeast Asia, Middle East and Europe are expected to be the major destinations driving the demand,” said Rajeshwar Burla, Group Head, Corporate Ratings at Icra.
“This along with the increase in tariffs at some of the major airports will result in operating income growth of 49-51 percent Y-o-Y in 2022-23. While operating profitability is expected to improve sequentially in 2022-23 to 29-30 percent from 18-19 percent in 2021-22, it is still likely to remain lower than the pre-COVID-19 level of 40 percent with full recovery likely in 2023-23 only,” he added.
ICRA expects India’s total passenger traffic to increase by 68-70 percent on-year to 317-320 million in 2022-23, with domestic air passenger traffic expected to rise 64-66 percent on year in the upcoming financial year.
International air passenger traffic is also expected to grow 100 percent in 2022-23 when compared to 2021-22 and surpass even pre-COVID levels of 2019-20.
The rating agency said that in the current financial year, 2021-22, India’s total passenger traffic is estimated to increase by 62-64 percent on-year to 187-189 million, despite the outbreak of two waves of COVID-19.
The government has from March 27 allowed international passenger flights to operate again after commercial flights were suspended for nearly two years.
About 60 foreign airlines from 40 countries have been approved to operate 1,783 weekly international flights from India during the summer schedule 2022, according to the civil aviation regulator, the Directorate General of Civil Aviation.
