New Delhi: The rating agency Information and Credit Rating Agency (ICRA) on Monday said that the airports in India are likely to record a net loss of Rs 5,400 crore and cash loss of Rs 3,500 crore in the financial year 2021 due to the decline in air passenger traffic in the wake of the Covid-19 pandemic.
According to ICRA, the domestic passenger traffic is expected to decline by 61 percent year-on-year and international traffic by 85 percent year-on-year during FY2021.
"With the sharp correction in passenger traffic estimated at around 66 percent year-on-year in FY2021, the sector is likely to witness the significant net loss of Rs 5,400 crore and cash loss of Rs 3,500 crore in FY2021," said ICRA in a report.
"With the subdued international traffic, which has a higher yield per passenger when compared to domestic traffic, the revenues and profitability are adversely impacted in FY2021. The sector is expected to witness a decline in operating income by 61% to Rs 8,400 crore while reporting an operating loss of around Rs 1,700 crore (-20 percent margin) and a net loss of Rs 5,400 crore (-64 percent margin) in FY2021," said Shubham Jain, Senior Vice President & Group Head, ICRA.
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"The overall cash loss for the sector is estimated at around Rs 3,500 crore in FY2021. With such significant losses, the debt coverage metrics have deteriorated sharply. However, the liquidity of airport operators is robust with opening cash balances of Rs 8,100 crore as of March 31, 2020, which has supported in meeting the operational expenses, debt obligations and equity requirements for capex," he added.
