Thursday, October 07, 2021

Domestic passenger traffic accelerates in September 2021 with a sequential growth of 2-3% as Covid-19 infection trajectory dips: ICRA

The domestic air passenger traffic grew by ~2-3% at around 68-69 lakh in September 2021, compared to ~67 lakh in August 2021. The same reflects a Y-o-Y growth of ~74%. The airlines’ capacity deployment for September 2021 was around 54% higher than September 2020 (~61,100 departures in September 2021, against 39,628 departures in September 2020). On a sequential basis, the number of departures in September 2021 were higher by ~6%, as Covid-19 infections demonstrated a downward trajectory.

Mr. Suprio Banerjee, Vice President & Sector Head, ICRA said: “For September 2021, the average daily departures were at ~2,100, significantly higher than the average daily departures of ~1,321 in September 2020, and higher than ~1,900 in August 2021, though they remained lower than ~2,200 in Jan 2021. The average number of passengers per flight during September 2021 was 113, against an average of 117 passengers per flight in August 2021. Though the recovery continued in September 2021, demand continues to be subdued from the corporate traveller segment as reflected by passenger traffic being lower by ~38% in September 2021 compared to pre-Covid levels.

The Ministry of Civil Aviation (MoCA), reduced the permissible capacity deployment to 50% of pre-Covid levels, with effect from June 01, 2021 due to the resurgence of the second wave of the pandemic. It had increased the permitted capacity to 72.5% with effect from August 12, 2021, but has now permitted increasing the capacity to 85.0% with effect from September 18, 2021 until further orders. Additionally, effective September 18, 2021, the Ministry relaxed the fare cap rule wherein the fare caps in each of the bands shall be applicable up to next only 15 days on a rolling basis.

07/10/21 IIFL Securities

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