+
International Recovery Lifts Aviation While Domestic Demand Weakens
ECONOMY & POLICY

International Recovery Lifts Aviation While Domestic Demand Weakens

Brokerage firm Equirus reported that the Indian aviation sector showed signs of a gradual recovery in international travel even as domestic demand moderated. The firm said international passenger recovery accelerated sequentially, supported by rising overseas volumes and improving load factors, while cautioning that traffic remained below the year-ago level.

Equirus noted that international passenger traffic rose eight per cent month-on-month in August to around 2.6 million (mn), and that revenue passenger kilometres (RPKs) increased nine per cent. Demand growth outpaced capacity sequentially, lifting the international passenger load factor to about 77.2 per cent, although international traffic was still roughly 13 per cent below the same month last year. The brokerage observed that these trends pointed to a potential recovery in overseas travel in the near term.

Domestic activity, by contrast, remained subdued, with domestic passenger traffic declining five per cent year-on-year and eleven per cent month-on-month to around 12 mn. Domestic RPKs fell five per cent year-on-year and 12 per cent month-on-month, and available seat kilometres (ASKs) moderated by nine per cent sequentially while flight departures were down eight per cent year-on-year. With demand declining slightly faster than capacity, the domestic passenger load factor eased to about 83.1 per cent, down 256 basis points month-on-month but marginally higher than a year earlier.

Cost pressures were highlighted as a persistent challenge, with Brent crude at around USD 90.1 per barrel in August, up 32 per cent year-on-year, and Singapore jet fuel near USD 154.7 per barrel, up 83 per cent. The rupee weakened to around Rs 95.7 per US dollar, which continued to push up dollar-denominated expenses such as aircraft leases and maintenance. The brokerage emphasised that these input cost dynamics would remain material for carrier profitability.

On market share, IndiGo strengthened its domestic share to about 67.2 per cent, while Air India Group's domestic share eased to roughly 24.2 per cent year-on-year. Equirus warned against reading monthly share moves as structural shifts and noted that an evolving capacity mix, with some carriers deploying more international capacity, could shape competitive dynamics in the coming months.

Brokerage firm Equirus reported that the Indian aviation sector showed signs of a gradual recovery in international travel even as domestic demand moderated. The firm said international passenger recovery accelerated sequentially, supported by rising overseas volumes and improving load factors, while cautioning that traffic remained below the year-ago level. Equirus noted that international passenger traffic rose eight per cent month-on-month in August to around 2.6 million (mn), and that revenue passenger kilometres (RPKs) increased nine per cent. Demand growth outpaced capacity sequentially, lifting the international passenger load factor to about 77.2 per cent, although international traffic was still roughly 13 per cent below the same month last year. The brokerage observed that these trends pointed to a potential recovery in overseas travel in the near term. Domestic activity, by contrast, remained subdued, with domestic passenger traffic declining five per cent year-on-year and eleven per cent month-on-month to around 12 mn. Domestic RPKs fell five per cent year-on-year and 12 per cent month-on-month, and available seat kilometres (ASKs) moderated by nine per cent sequentially while flight departures were down eight per cent year-on-year. With demand declining slightly faster than capacity, the domestic passenger load factor eased to about 83.1 per cent, down 256 basis points month-on-month but marginally higher than a year earlier. Cost pressures were highlighted as a persistent challenge, with Brent crude at around USD 90.1 per barrel in August, up 32 per cent year-on-year, and Singapore jet fuel near USD 154.7 per barrel, up 83 per cent. The rupee weakened to around Rs 95.7 per US dollar, which continued to push up dollar-denominated expenses such as aircraft leases and maintenance. The brokerage emphasised that these input cost dynamics would remain material for carrier profitability. On market share, IndiGo strengthened its domestic share to about 67.2 per cent, while Air India Group's domestic share eased to roughly 24.2 per cent year-on-year. Equirus warned against reading monthly share moves as structural shifts and noted that an evolving capacity mix, with some carriers deploying more international capacity, could shape competitive dynamics in the coming months.

Related Stories

Gold Stories

Next Story
Infrastructure Transport

Madhya Pradesh Plans Airport Every 150 Km, Airstrip Every 75 Km

The Madhya Pradesh government plans to establish an airport every 150 km, an airstrip every 75 km and a helipad every 45 km, according to the state aviation department. Airports being developed in Ujjain and Shivpuri are expected to take the state’s airport count to 10. The government stated that Madhya Pradesh currently has eight airports in eight cities. The locations named by the department include Indore, Bhopal, Jabalpur, Gwalior, Khajuraho, Rewa and Satna. The state also has more than 20 airstrips and 220 helipads, while permanent helipads are planned in all 230 Assembly constituencies..

Next Story
Infrastructure Transport

West Bengal Plans Four Airports for 2028 Completion Under UDAN

West Bengal will develop four new airports under an agreement signed between the Union Civil Aviation Ministry and the state government, with all facilities targeted for completion by 2028. Union Civil Aviation Minister K Rammohan Naidu said the airports would be located at Charra in Purulia, Kalaikunda in Paschim Medinipur, Balurghat in Dakshin Dinajpur and Hasimara in Alipurduar. The project is part of the Centre’s regional connectivity UDAN programme. The Union government has committed Rs. 290 bn for West Bengal’s aviation sector over the next decade, while the state government will pro..

Next Story
Infrastructure Transport

Mumbai Airport Bars Russian Airlines as Agent Seeks Ministry Intervention

Mumbai airport has stopped accepting cargo booked on Russian flag carrier Aeroflot, disrupting shipments and prompting the airline’s cargo sales agent, Delmos Aviation, to seek intervention from the Ministry of Civil Aviation. The restrictions also affect cargo booked on Volga-Dnepr Airlines, according to a letter submitted by Delmos Aviation to the ministry on September 30. Aeroflot operates daily flights between Moscow and Delhi and runs a winter seasonal service to Goa. Bonded cargo from Mumbai and other cities is transported by road to Delhi before being flown to Russia. The agent said t..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

SPECIAL OFFER
QR Code