New Delhi, Nov 24, : .The airport infrastructure sector is expected to see an increase in operating profits in FY22 due to the ease in travel restrictions following the lockdown, ICRA stated Wednesday. The ratings agency stated that the sector’s outlook is still “negative”.
Rajeshwar Burla (Group Head, Corporate Ratings, ICRA) stated that the sector’s operating income is Rs 14,000 crore and operating profits are Rs 3,250 crore (operating losses of Rs 1,450 crore in FY21 and Rs 3,250 crore in FY22, respectively).
“Domestic traffic has seen healthy MoM (monthly-on-month), growth since June 2021.Traffic reached 72 percent of preCovid levels in Oct 2021, the highest level since the outbreak of the pandemic.
According to the ratings agency, passenger traffic is expected increase by 82-84 percent YoY (year-on year) in FY22.
It stated that the significant increase in vaccinations, decline in Covid cases, and pick-up in revenge leisure travel are all supporting domestic passenger traffic growth.
The sector was also supported by the Ministry of Civil Aviation’s recent announcement to increase seat capacity to 100 percent with effect from October 18.
ICRA also notes that ongoing capacity expansion plans at major airports will be delayed by 12-18 months due to the pandemic.
It stated that the completion cost of construction is expected to rise due to an increase in interest.Some airports have paid capex with bullet bonds, which have been drawn down simultaneously.
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