Preparing for a take-off

Mumbai: The recovery for the hotel and aviation sectors has been slow. While still not there yet, these two are the last off the blocks as spends on them are considered discretionary. However, the early signs of activity are visible. The airline data for August 2009 shows a 26 per cent jump in passenger volumes year-on-year to 36 lakh, the third month of double digit growth over the previous year.
While the hotel space is up on increase in occupancies and room rents, the airlines space has caught the investors’ fancy due to higher demand and plans of airlines to raise funds mainly to repay debt.
Going ahead, airline passenger volumes are expected to jump by 12 per cent for the current fiscal.
Says Sridhar Chandrasekhar, head, CRISIL Research, “Domestic demand is expected to grow by 12 per cent in 2009-10 driven by low ticket prices offered by carriers, improved economic environment resulting in increasing business and leisure travel.”
Analysts estimate a further 13.5 per cent increase in passenger volumes in 2010-11. The sector has also been improving its operational performance thanks to the reduction of aviation turbine fuel costs by half from a peak of Rs 72 per litre in August, 2008.
28/09/09 Ram Prasad Sahu/Business Standard

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Categories: Indian Aviation- In General Sep 2009