Even though the government’s proposed Aviation Policy promises all the sops for new entrants and secure the future of existing airliners including hike in FDI limit, incentives for MRO, viability gap funding for flying small towns and relook at the 5/20 rule, private players are reluctant and investors wary to bet on new ventures.
No wonder investors showed thumbs down to Vijay Sankeshwar, chairman of VRL Logistics’ plan to start a new regional aviation company. Shares of the VRL were locked in lower circuit despite frantic assurances from the top management that the new venture will be in Sankeshwar’s personal capacity.
Investors worry and the reason for their bearishness outlook are on expected lines. But India's largest logistics firm VRL Logistics’ new venture plan may be taking cues from some good developments in the airlines industry.
Let’s take a look at score card for some major aviation companies of India.
Interglobe Aviation the company which operates Indigo, the country’s largest airline by market share, has reported profits for 8 consecutive years. Air India, the ailing national carrier, is expected to report an operating profit in FY 2015-16. SpiceJet has staged brilliant turn around with the original promoter Ajay Singh back on board and recorded annual profit for the first time since 2007, a year ahead of schedule under its 2014 turnaround plan.
According to CAPA India’s report GoAir is expected to post a net profit of around $20-25 million for the year ending 31 March and expected to be listed on stock exchanges shortly.
As per media reports, favourable policy in government’s new aviation policy—focus on regional connect, doing away with 5/20 rule coupled with healthy passenger growth and low crude oil prices is keeping the aviation stocks buzzing on the bourses.
29/05/16 Shiv Gupta/Business Broadcast News
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No wonder investors showed thumbs down to Vijay Sankeshwar, chairman of VRL Logistics’ plan to start a new regional aviation company. Shares of the VRL were locked in lower circuit despite frantic assurances from the top management that the new venture will be in Sankeshwar’s personal capacity.
Investors worry and the reason for their bearishness outlook are on expected lines. But India's largest logistics firm VRL Logistics’ new venture plan may be taking cues from some good developments in the airlines industry.
Let’s take a look at score card for some major aviation companies of India.
Interglobe Aviation the company which operates Indigo, the country’s largest airline by market share, has reported profits for 8 consecutive years. Air India, the ailing national carrier, is expected to report an operating profit in FY 2015-16. SpiceJet has staged brilliant turn around with the original promoter Ajay Singh back on board and recorded annual profit for the first time since 2007, a year ahead of schedule under its 2014 turnaround plan.
According to CAPA India’s report GoAir is expected to post a net profit of around $20-25 million for the year ending 31 March and expected to be listed on stock exchanges shortly.
As per media reports, favourable policy in government’s new aviation policy—focus on regional connect, doing away with 5/20 rule coupled with healthy passenger growth and low crude oil prices is keeping the aviation stocks buzzing on the bourses.
29/05/16 Shiv Gupta/Business Broadcast News
