Air traffic to grow upto 340 million FY25; airlines revenue to grow 15-17%: ICRA
International air traffic that regained the pre-pandemic levels in FY24, is expected to further grow by 10-14% in the current fiscal year.
- May 16, 2024,
- Updated May 16, 2024 6:05 PM IST
Domestic passenger air traffic is expected to grow steadily in the current fiscal year. After growing by 13% in the previous year, air passenger traffic in India is expected to grow 8-10% in FY2025, as per a latest estimate by ICRA.
While in FY24, some domestic air traffic surged to 307 million, this year the number may touch 340 million. Since the COVID-19 pandemic rattled the aviation industry, the market in India has bounced back sharply. From 105 million domestic passenger traffic in FY21, it jumped to 167 million in the following year - growing 59% year-on-year. In FY23, it further grew 62% to 270 million.
In fact, the recovery in the number of passenger traffic in India post-pandemic has been better than most economies. In India, while the number of overall passenger traffic in 2023 was 6% higher than the 2019 levels. In leading economies and/or regions like Europe and China, the 2023 numbers are 5.3% and 6.1% lower than 2019 levels, respectively.
While in the USA, the passage traffic numbers are just at 2019 levels, in Canada & Australia, its 8.6% and 8.5% lower, respectively.
International air traffic that regained the pre-pandemic levels in FY24, is expected to further grow by 10-14% in the current fiscal year. Last year, international passenger traffic stood at 70 million - slightly over the previous high of 69 million in FY19. In FY25, the figure is expected to reach 77-80 million levels.
With passenger traffic growing at a healthy pace, operating revenue for the civil aviation industry is set to rise handsomely. According to ICRA’s estimates, in FY25 operating revenue to grow 15-17% over the previous year. And the trend is expected to continue in FY26 as well. In FY24, operating revenue had grown by 17% year-on-year.
“With sustained improvement in both domestic and international passenger traffic, rise in tariffs at some of the major airports and ramp-up of non-aeronautical revenues, the revenues for ICRA’s sample set are likely to grow by around 15-17% YoY in FY2025. Despite expectation of improved profitability, coverage metrics may moderate on account of higher interest outgo with commercialisation of capex at key airports,” it noted.
Domestic passenger air traffic is expected to grow steadily in the current fiscal year. After growing by 13% in the previous year, air passenger traffic in India is expected to grow 8-10% in FY2025, as per a latest estimate by ICRA.
While in FY24, some domestic air traffic surged to 307 million, this year the number may touch 340 million. Since the COVID-19 pandemic rattled the aviation industry, the market in India has bounced back sharply. From 105 million domestic passenger traffic in FY21, it jumped to 167 million in the following year - growing 59% year-on-year. In FY23, it further grew 62% to 270 million.
In fact, the recovery in the number of passenger traffic in India post-pandemic has been better than most economies. In India, while the number of overall passenger traffic in 2023 was 6% higher than the 2019 levels. In leading economies and/or regions like Europe and China, the 2023 numbers are 5.3% and 6.1% lower than 2019 levels, respectively.
While in the USA, the passage traffic numbers are just at 2019 levels, in Canada & Australia, its 8.6% and 8.5% lower, respectively.
International air traffic that regained the pre-pandemic levels in FY24, is expected to further grow by 10-14% in the current fiscal year. Last year, international passenger traffic stood at 70 million - slightly over the previous high of 69 million in FY19. In FY25, the figure is expected to reach 77-80 million levels.
With passenger traffic growing at a healthy pace, operating revenue for the civil aviation industry is set to rise handsomely. According to ICRA’s estimates, in FY25 operating revenue to grow 15-17% over the previous year. And the trend is expected to continue in FY26 as well. In FY24, operating revenue had grown by 17% year-on-year.
“With sustained improvement in both domestic and international passenger traffic, rise in tariffs at some of the major airports and ramp-up of non-aeronautical revenues, the revenues for ICRA’s sample set are likely to grow by around 15-17% YoY in FY2025. Despite expectation of improved profitability, coverage metrics may moderate on account of higher interest outgo with commercialisation of capex at key airports,” it noted.