Sharing its views on the latest monthly passenger traffic data, ratings agency ICRA has highlighted that domestic passenger traffic is estimated at 1360 lakh, a Year-on-Year (YoY) growth of 60 per cent over 852 lakh in FY2022, and only short of 4 per cent, compared to pre-Covid levels of 1415 lakh in FY2020.
With the domestic aviation industry in the country continuing to witness recovery with passenger number rising month-on-month growth, ICRA in its commentary also mentioned that for FY2023, the overall airlines’ capacity deployment was higher by 38 per cent as compared to FY2022.
The airlines’ capacity deployment in March 2023 was higher by 14 per cent than in March 2022 and 7 per cent higher than pre-covid levels of March 2019.
Commenting on the development, Suprio Banerjee, Vice President & Sector Head – Corporate Ratings, ICRA, said, “Domestic passenger traffic for March 2023 is estimated at 130 lakh, 8 per cent higher than the domestic passenger traffic of 121 lakh in February 2023, 22 per cent higher in comparison to 106 lakh in March 2022 and 12 per cent higher by pre-Covid levels of 116 lakh of March 2019.”
“Despite a healthy recovery in passenger traffic, the domestic aviation industry continues to face challenges on account of elevated ATF prices and depreciation of INR vis-à-vis the USD, both of which have a major bearing on the airlines’ cost structure. The airlines’ efforts to ensure fare hikes proportionate to their input cost increases will be key to expanding their profitability margins,” he added.It is estimated that the domestic aviation industry operated at a passenger load factor (PLF) of 89 per cent in March 2023, against 82 per cent in March 2022 and 87 per cent in March 2019 (pre-Covid levels).
For 11M FY2023, international passenger traffic for Indian carriers stood at 216.0 lakh, thereby almost matching the pre-Covid 11M FY2020 levels of 217.8 lakh, although 9 per cent lower than the peak levels of 238 lakh for 11M FY2019.
ICRA had recently revised its outlook on the Indian aviation industry to stable from negative on the back of fast-paced recovery in domestic passenger traffic in FY2023 and expected continuation of the same in FY2024.