Sunday, May 13, 2018

A look at the key pressure points for India's aviation sector

These are interesting times for India’s aviation industry. All kinds of news are making headlines. The resignation of IndigoNSE 1.49 % CEO Aditya Ghosh sent its stock tumbling.

GoAir is suing former CEO Wolfgang Prock-Schauer over data theft. The promoter of defunct Kingfisher, Vijay Mallya, has been declared a fugitive. Rumblings at Jet Airways signal that Etihad (owner of 24% equity) might exit the company by this year-end.

Almost all airlines, barring Spicejet, have shuffled their top deck in the past one year. And an expat wave is sweeping through the corner rooms. To top it all, the government’s move to disinvest Air India is being keenly watched.

All this is happening when India’s aviation sector has been experiencing good times. Passenger traffic growth has been robust. A long run of low crude oil price has helped airlines, especially low-cost carriers, improve their financial health. Aircraft orders look robust. Some, like Indigo, are readying for a big long-haul international play, which will also be more profitable.
13/05/18 Economic Times