Monday, November 28, 2016

Air India to get Rs 1,713 cr equity support this fiscal against Rs 3,900 cr demand

Air India will get less than half of the equity support it wanted from the government this fiscal. Against the demand of Rs 3,900 crore, the state-owned airline will get only Rs 1,713 crore in FY17, official sources said.
The capital infusion is part of the Rs 30,000-crore bailout package for Air India in the form of equity support by the government. So far, Rs 23,933 crore has been released to the company in several tranches.
Air India sources said that the government did not meet its full demand for the current fiscal citing its own constraints regarding meeting the fiscal deficit. Due to the reduced support during the fiscal, the airline may find it difficult to meet its operational and financial tragets.
For the first time in nearly a decade, Air India reported an operating profit of Rs 105 crore in the last fiscal.
However, during the April-June quarter of the current fiscal it reported an operational loss of Rs 246.14 crore. The target fixed by Air India for operating profit for the first quarter of 2016-17 was Rs 87.28 crore. The reason attributed for the loss during the quarter was decline in revenue yields by around 6 per cent over the budgeted target resulting in decline in passenger revenue and also due to fall in cargo revenue compared with budgeted estimates.
28/11/16 Malyaban Ghosh/The Indian Express