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Coronavirus update: IndiGo says fall in bookings to hit quarterly earnings

Coronavirus update: IndiGo said that due to the dip in bookings, it expects quarterly earnings to be materially impacted

twitter-logoBusinessToday.In | March 12, 2020 | Updated 09:39 IST
Coronavirus update: IndiGo says fall in bookings to hit quarterly earnings
Coronavirus news: Aviation sector impacted by COVID-19 outbreak

IndiGo airline has said that it expects its quarterly earnings to be adversely impacted due to coronavirus. InterGlobe Aviation, parent company of the airline said on Wednesday that daily bookings have dipped by 15-20 per cent due to the outbreak. According to the company, the sharp fall in rupee would also hit the company's dollar-denominated liabilities.

"Over the past few days however, week-on-week, we have seen a 15-20 per cent decline in our daily bookings. Please note that the numbers could change from here based on how the situation evolves," stated the airline.

IndiGo said that due to the dip in bookings, it expects "quarterly earnings to be materially impacted". The airline added that in January and February, IndiGo witnessed modest impact due to COVID-19.

Also read: Air fares crash due to coronavirus; IndiGo, Air India, SpiceJet, Vistara feel the pinch

It said that it cancelled its flights to China and Hong Kong and redeployed flights in other markets. "We cancelled our flights to China and Hong Kong and reduced frequency to certain other Southeast Asia markets. This capacity was redeployed in other markets without having a material impact on our revenues," it noted.

The airline had a domestic market share of around 48 per cent in January, as per official data.

In the wake of the coronavirus outbreak, many countries, including India, have imposed travel restrictions. There are at least 60 cases of coronavirus infections in India.

Also read: Coronavirus wipes $70 billion off airline sector

The sector has witnessed large-scale flight cancellations and poor demand that has reflected on the airfares across the board, as reported in BusinessToday.In. "For the first three weeks of February, the domestic traffic growth was almost similar to January but the demand tanked by 2-4 per cent in the last week of February. March is expected to witness substantial drop in air travel demand with forward bookings (for flying schedules over the next two months) are down by about 20 per cent," said an aviation analyst.

Additionally, a Reuters analysis has said that the coronavirus spread has wiped off almost a third or $70 billion off the world's top 20 listed airlines.

Also read: The bleak financials of India's domestic airlines

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