Thursday, October 01, 2020

AAI likely to post net loss of over Rs 1,000 crore in FY21, first in 25 years

The Airports Authority of India is likely to post a net loss of over Rs 1,000 crore in the current financial year ending March 2021 on account of low revenues due to COVID-19, sources told CNBC-TV18.

This is expected to be AAI's first net loss since its inception in 1995 or first net loss over a period of 25 years.

COVID-19 has severely impacted the aviation business in domestic and global markets. In India, the revenue of airport operators fell to Rs 894 crore during Apr-Jun from Rs 5,745 crore a year ago.

As a result, AAI has witnessed a severe fall in revenue collected from its cash cows,  Delhi and Mumbai airports. There has also been an almost 80 percent drop in traffic at the 91 airports solely operated by AAI as total footfalls fell to 29,73,447 in August from 1,45,68,166 in January.

Several concessionaires at airports are unable to make payments to AAI on account of weak business as passengers continue to be concerned over COVID-19 pandemic.

Despite dark clouds looming over the topline, AAI aims to continue with its proposed capital expenditure plan for over Rs 4,000 crore for 2020-2021 (Apr-Mar), out of which Rs 3,000 crore is expected to be part of borrowings.

"We have finalised a term loan with Axis Bank for around Rs 2,100 crore. Disbursement hasn't started yet but should start soon. We are in discussions with banks for another tranche.. around Rs 1000 crore," AAI Chairman Arvind Singh told CNBC-TV18 in a query on a borrowing plan for 2020-21.

AAI has the approval to borrow more funds from the domestic or overseas market including offshore bonds, secured or unsecured. CNBC-TV18 has learnt that AAI aims to borrow another Rs 1,000 crore by January 2021. In addition, upfront payment for privatised airports will help in garnering more funds.

01/10/20 Anu Sharma/CNBC TV18

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