THE domestic aviation industry, which has been impacted by coronavirus pandemic and subsequent lockdown, will require an additional funding worth Rs 32,500 to 35,000 crore during FY21-23, according to rating agency Icra. It also said the industry-level debt is expected to increase to Rs 465 billion (around Rs 46,500 crore) over FY 2021-22.
At the same time, the industry is expected to report revenue de-growth of 44 per cent and a negative CAGR (compound annual growth rate) of 26 per cent in 2021-2023, Kinjal Shah, Vice President at Icra, said during a webinar on Thursday. Considering the daily net loss of Rs 75-Rs 90 crore during the shutdown of operations and the expected weak demand, the Indian aviation industry will require additional funding of Rs 325-350 billion (Rs 32,500 to 35,000 crore) over FY2021-23. “The industry level debt is expected to increase to Rs 465 billion over FY 2021-22,” Shah said.
In the forecast, Icra has included an aggregate of all the five private sector players -- IndiGo, SpiceJet, GoAir, Vistara and AirAsia India -- to make the balance sheet. It may be mentioned here, that the disinvestment-bound Air India has parked nearly half of its total -- over Rs 60,000 crore -- debt into the special purpose vehicle (SPV) to make the heavily-leveraged balance sheet more attractive to the prospective buyers.