Wednesday, May 15, 2019

NAC’s profit surges after grounding of Jet Airways

Kathmandu: The financial troubles that forced Jet Airlines to ground its planes provided a windfall for Nepal Airlines Corporation (NAC).
As NAC increased the number of daily flights to India, it has currently been making a profit of around 40 per cent in each flight, which is reported to be fully booked these days. Moreover, the corporation’s wide-body aircraft has been clocking in 10 to 11 hours of flight time per day now compared to just seven hours before the Jet Airways fiasco.
However, one NAC official said that the recent profit is hardly enough to offset the losses incurred by the national flag carrier.
This is because the corporation is yet to clear the loan and interest on the wide-body aircraft.
The national flag carrier had purchased the wide-body aircraft by borrowing Rs 24 billion at 10 per cent interest from the Employees Provident Fund (EPF) and Citizen Investment Trust (CIT). As per the loan agreement, NAC has to pay back the loan in 60 instalments to clear the debt of EPF and CIT.
According to Navaraj Koirala, joint spokesperson for NAC, the corporation has to pay around Rs 804 million per instalment.
15/05/19 Himalayan Times
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