Aviation Industry in India

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Aviation Latest News And Updates

SpiceJet hikes cancellation charges
July 06, 2015 10:21 AM
Low-cost carrier SpiceJet on Sunday hiked the ticket cancellation charges for both domestic and international travel. The cancellation charges for domestic flights were revised to Rs.1,800 from Rs.1,500 while for international flights it will now be at Rs.2,250, SpiceJet said. Now a passenger cancelling more than 2-48 hours before departure has to pay Rs.2,250 per ticket, up 50 percent from earlier. A cancellation before 2-7 days will cost Rs.2,000 and a person who cancels 7-30 days earlier will pay Rs.1,500. Customers who cancel 30 days or before will be charged Rs.1,250 while those who cancel less than two hours before departure cannot have any refund. Source: IANS
India's domestic air passenger traffic up 18 percent
July 03, 2015 10:14 AM
The International Air Transport Association (IATA) on Thursday reported that India's domestic passenger traffic increased by 18.2 percent in May 2015. The country's domestic traffic spiked 20.7 percent in April 2015 and 17.9 percent in March 2015. India's domestic capacity in the month under review rose by 7.7 percent when compared to May 2014. "India’s domestic demand accelerated 18.2 percent in May compared to May 2014, likely owing to market stimulation by local carriers as well as notable improvements in economic growth," the association which represents nearly 260 airlines was quoted in a statement. Earlier, data furnished by the civil aviation ministry showed that domestic air passenger traffic increased by 18.35 percent in May, which stood at 71.27 lakh passengers -- up from 60.22 lakh in the corresponding month last year. Source: IANS
IndiGo files prospectus for IPO
July 01, 2015 10:34 AM
Budget passenger carrier IndiGo on Tuesday filed the prospectus for a proposed initial public offering (IPO) which intends to raise Rs.1,272.2 crore. An IPO is a financial instrument through which an unlisted company offers a particular percent of its total shares to the public for the first time. The funds raised through the process are utilised for various purposes like working capital, debt repayment, and acquisitions. According to the airline, its operating InterGlobe Aviation filed a draft red herring prospectus (DRHP) with the Securities Exchange Board of India (SEBI) in relation to a proposed IPO. Source: IANS
Air India to operate international flight from Odisha
June 29, 2015 09:56 AM
National flag carrier Air India will operate its international flight from Biju Patnaik Airport Bhubaneshwar by July, it was announced on Saturday. Air India will operate a flight from Bhubaneswar to Abu Dhabi in the UAE via Hyderabad. "...it has been decided to start operation of international flights from Biju Patnaik Airport. Air India will commence international operations before July 10," said Petroleum Minister Dharmendra Pradhan. Meanwhile, the Odisha government decided to double tourist footfalls to about 2 crore which are at present about 1 crore per annum. Source: IANS
India invites French investments in aviation sector
June 19, 2015 01:25 PM
The government on Thursday invited French investments into India's aviation sector for manufacturing and infrastructure development. The invitation to invest in India was made during a meeting between Civil Aviation Minister Ashok Gajapathi Raju and his counterpart Alain Vidalies. Raju met Vidalies, who hold the portfolio of transport, marine affairs and fisheries, on the sidelines of the 51 International Air Show in Paris. "They discussed various issues related to aviation sector. The discussion focussed on manufacturing, infrastructure development and investment into India’s aviation sector," the civil aviation ministry said in a statement. Source: IANS

Overview of Airlines industry in India
Airlines industry in India The aviation industry in India is one of those sectors that saw a constant pace of growth among the other industries in the world over the past many years. The open sky policy of the government has helped a lot of overseas players entering the aviation market in India. From then, it has only been growing in terms of players and the number of aircrafts. At present, private airlines account for around 75% portion of the domestic aviation market.

The 9th largest aviation market in the world is India. Taking the help of the statistics from the Ministry of Civil Aviation, approximately 29.8 million passengers traveled to/from India in 2008, showing a surge of 30% from 2007. The prediction stated that international passengers will touch 50 million by 2015. More opportunities in the aviation industry in India are likely to make way for about 69 foreign airlines from 49 countries.

Growth of Indian Aviation industry
The Indian Civil Aviation market grew at a CAGR of 18%, being valued round US$ 5.6 billion in 2008. Further statistics revealed that the air traffic in August 2009 was a double digit figure. The domestic airliners flew 3.67 million passengers in August 2009, as against 2.92 million in the corresponding period of 2007, up by 26%. The Centre for Asia Pacific Aviation (CAPA) has estimated that the domestic traffic will go up by 25% to 30% till 2010 along with a surge in the international traffic by 15%. There would be more than 100 million passengers by 2010. Then again by 2020, Indian airports will in all probability handle over 100 million passengers every year. The investment plans to the tune of US$ 9 billion has been made by the Aviation Ministry for modernizing the existing airports by 2010.

In terms of domestic passengers' volume, US have always been the leader with followers in the league like China, Japan and India. The number of domestic flights went up by 69% from 2005 to 2008, with the domestic aviation sector growing at 9-10%.

Market share of key players in the Indian aviation sector
Name of the players Market Share
Kingfisher Airlines and Kingfisher Red (previously Air Deccan) 28%
Jet Airways and Jet Lite (previously Air Sahara) 25%
Air India and Indian (previously Indian Airlines) 16%
IndiGo 14%
SpiceJet 12%
GoAir 3%
Paramount Airways 2%
MDLR Airlines 0.004%

Future of Airlines industry in India
The challenges of the Indian aviation industry are cited below:
  • Passenger traffic is estimated to grow at a CAGR of over 15% in the coming few years.
  • The Ministry of Civil Aviation would handle around 280 million passengers by 2020.
  • US$ 110 billion investment is envisaged till 2020 with US$ 80 billion solely for new aircraft and US$ 30 billion for developing the airport infrastructure.