New Delhi: Airlines in India can make their highest collective losses in more than RS 20,000 fiscal crore because of the twin punch of Covid impact on traffic and the price of steep jet fuel, the rating agency said.
This estimates the loss of 44% which is significantly higher than losing FY21 RS 13,853 Crore.
This will push back the industrial recovery outside the 2023 fiscal, he said.
The domestic air trip has made a smart recovery until the beginning of last month when Omicron blew again.
Crisil Rating Director Nitesh Jain said: Three major registered airlines have reported a net loss of Rs 11,323 Crore in the first half of fiscal 2022.
The sharp surge in domestic air traffic will make losses in the third quarter, but net loss will increase significantly in the fourth quarter Because the third wave has brought restrictions on travel and cancellations of aviation.
As a result, we expect airline to report this steeper fiscal net loss.
“The price of flight fuel turbines (ATF) has reached high highs of RS 83 per liter in November 2021, up from November 2021, up from The average price of Rs 44 in fiscal 2021 and around Rs 63 in April-June 2021.
While ATF prices declined 6-18% in December 2021 and 2022 because of the reduction in value added tax by various countries, they remained high at RS 77- 78 per liter, said Crisil.
Rakhit Kachhal, Director of the CROP Partner, said: “Operational losses that constantly cause an increase in debt of 35% (excluding lease obligations) to the top RS 54,000 Crore from March 2020 to September 2021.
Sustainable net losses will stretch up negative views on This sector.
“” In Milieu, airlines tend to continue to save cash, including delay maintenance and expenditure of major capital, while renewing aircraft rent and maintaining other fixed ropes.
In addition to following the cost control measures, the third wave is prolonged, the emergence of variants New and increased competitive intensity with the launch of new airlines is the downside risk, “Crisil added.
The third wave has caused domestic air traffic to decrease 25% in the first week of January.
Similar trends were observed during the second wave in April and May 202 when air traffic decreased by 25% and 66%, sequentially.