Rating agency Icra has said the domestic airport sector is expected to incur a net loss of Rs 5,400 crore, and cash loss of Rs 3,500 crore in current financial year (FY21), impacted by a 66 per cent year-on-year slip in passenger traffic amid COVID-19 induced travel restrictions.The agency also said that given the significant delays in tariff orders in the past, timely tariff orders of regulator Airports Economic Regulatory Authority, which adequately compensates for the ongoing Capex and revenue loss due to COVID remains critical from the credit perspective.
It mentioned domestic passenger traffic may drop by 61 per cent, while the international passenger traffic will nose dive by 85 per cent in 2020-21. However, it stated the industry could see its profitability improving to Rs 190 crore backed by an expected massive 130 per cent year-on-year recovery in traffic in the next fiscal.
It said the major growth drivers for the sectors in the near-term will be the success of mass vaccination, resumption of business travel, improvement in leisure travel, a ramp-up in non-aero revenue streams and monetisation of real-estate land parcels.