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IndiGo: Financial headwinds make aviation leader’s flight wobbly

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New Delhi, July 23:  The Covid-19 pandemic impacted the aviation sector badly, and IndiGo, the country’s leading private carrier, was not untouched by the financial stress.

For the quarter ended March 2022, which was impacted by the ‘Omicron’ wave, IndiGo reported a net loss of Rs 16,818 million.

IndiGo, with a fleet size of over 280 aircraft, is leading the Indian aviation sector. With an occupancy rate of 78.5 per cent, the airline recorded a market share of 56.9 per cent in June.

However, many IndiGo flights reported delays during the last week of June, reportedly due to manpower crunch as a significant number of cabin crew members went on sick leave.

In this regard, the Directorate General of Civil Aviation (DGCA) has sought an explanation from the airline authorities.

Also, last week the airline reported two incidents of technical snags on July 14 and July 17 when flights had to be diverted.

Aviation consultant and former chief of Vayudoot, Harsh Vardhan, said that many airlines have resorted to cost-cutting and retrenchment.

“Aircraft were lying idle. Now, after a sudden surge in demand, a large number of aircraft have been deployed whereas many airlines have not recruited enough manpower to handle the pressure. New staff are there at many places, but they need to be synchronised with the system and require reorientation,” he said.

When asked whether entry of new players, including Akasa Air and Jet Airways, has led to manpower shortage, an IndiGo spokesperson said that India continues to be one of the world’s largest civil aviation markets, as it ramps up capabilities and capacity in infrastructure and services.

“In India, currently only 7 per cent of the 1.3 billion population travel by air. There is a huge potential to deepen the penetration of air travel by enhancing accessibility and providing affordable fares. And this is our focus right now.

“We will keep expanding our domestic and international network and will stay true to our promise of affordable fares, hassle-free service and on-time performance across a wide network, to catalyse the transition from rail travel to air travel,” the spokesperson said.

“As a responsible employer, IndiGo is in constant dialogue with its employees to take care of any concerns and this is an ongoing activity. So far, our operations continue to be normal, while we add several new destinations to our network and look forward to welcoming customers from across India and the world,” the airline said.

For the quarter ended March 2022, which was impacted by the Omicron wave, IndiGo reported a net loss of Rs 16,818 million, excluding foreign currency loss of Rs 6,123 million, while the net loss for the quarter aggregated to Rs 10,695 million.

For the year ended March 2022, which was impacted first by the Delta variant and then by the Omicron variant, IndiGo reported a net loss of Rs 61,618 million.

In FY2022, Indigo reported an increase in the number of passengers by 62.3 per cent compared to the previous financial year. It also recorded strong revenue growth with revenue from operations at Rs 259,309 million, an increase of 77.1 per cent compared to the previous year.

For the quarter ended March 2022, Indigo’s passenger ticket revenues were Rs 68,847 million, an increase of 38.4 per cent, while its ancillary revenues were Rs 10,583 million, an increase of 18.8 per cent compared to the same period last year.

IndiGo operated at a peak of 1,577 daily flights during the quarter, including non-scheduled flights. The airline provided scheduled services to 73 domestic destinations and 15 international destinations during the quarter.

“IndiGo is best positioned to maximise revenue in a recovering market. As we work to return the airline to profitability, we are focused on maintaining our cost leadership position and continuing to build the most efficient network in the region,” said the airline.

IANS
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