Fuel price rise to impact industry profitability: ICRA
‘As per ICRA estimates, ATF price increase has resulted in the fuel cost per ASKM (CASK) of the domestic aviation industry increasing to Rs. 1.05 in June 2016 from a low of Rs. 0.82 in February 2016. This is expected to dent profitability of the airlines in Q1FY2017’, says Subrata Ray, Sr Group VP, ICRA Limited. Domestic passenger traffic in June 2016 reported a robust YoY growth of 20.8%, primarily backed by low airfares on account of intense competition. Considerable decline in domestic aviation turbine fuel (ATF) prices over the last fiscal had provided buffer to the airlines to reduce airfares; however, the recent increase in ATF prices has partially curtailed the benefit. ‘As per ICRA estimates, ATF price increase has resulted in the fuel cost per ASKM (CASK) of the domestic aviation industry increasing to Rs. 1.05 in June 2016 from a low of Rs. 0.82 in February 2016. This is expected to dent profitability of the airlines in Q1FY2017’, says Subrata Ray, Sr Group VP, ICRA Limited. The industry continued to add capacity on domestic routes during the month, which reported a growth of 22.4% YoY backed by fleet expansion and scale-up by the airlines. The capacity addition is likely to grow at a healthy rate going forward as indicated by pending aircraft orders of various airlines. Despite the capacity addition and impact of off-peak season, the domestic industry reported adequate PLF of 81.0% in June 2016. Joe Thuney Jersey
Four years after AAI study on 2nd airport, TN yet to lay a brick
The Tamil Nadu government is yet to take any steps to build the second airport at Sriperumbudur even though Airports Authority of India (AAI) has submitted a pre-feasibility report almost four years ago. Union minister of state for civil aviation Jayant Sinha has said the ministry has not received any proposal from the state government for the construction of the airport in Sriperumbudur, 40km from Chennai. AAI handed over the report prepared by International Civil Aviation Organisation (ICAO) to the state government four years ago saying the facility can be constructed.The authority hinted that they were ready to build the airport if the state government gave them the green signal and acquired land. Bud Dupree Authentic Jersey