New Delhi(PTI): Government-owned Air India is mulling setting up of an aviation university to cater…
Mumbai(PTI): For the first time since its merger, Air India will report an operating profit of about Rs six crore in the current fiscal, primarily on account of low crude prices and “improved operational efficiency”.
“Air India is going to report operating profit in this financial year (ending March 31, 2016) and is expected to be Rs 6 crore,” Civil Aviation Secretary R N Choubey said today.
The loss-making national carrier, surviving on a Rs 30,000 crore bailout package, is implementing a turnaround plan. Air India and Indian Airlines merged into one entity in 2007.
“The airline is benefiting from fall in crude oil prices and improved operational efficiency,” Choubey said.
According to him, better on-time performance and increased availability of passenger aircraft have helped in improving operational efficiency.
According to airline sources, Air India has saved Rs 2,000 crore on account of lower fuel bill.
It has also seen a significant improvement in its overall on-time performance in the recent months. As against an OTP of 57% from the four metro airports—Delhi, Mumbai, Bengaluru and Hyderabad — in January, its
OTP from these four airports stood at close to 82%, in September 2015.
The airline is saddled with a debt of about Rs 40,000 crore that includes a long-term loan taken for aircraft purchase and working capital loan. It has accumulated a loss of close to Rs 30,000 crore.
Air India had reported net loss to the tune of Rs 5,547.47 crore in the previous fiscal.
According to the CAPA Mid-year profitability review of the Indian carriers for FY 2016, domestic airlines industry losses are expected to trim further to $500-550 million, down from its June estimates of $680-750 million.
The Sydney-based aviation think-tank Centre for Asia Pacific Aviation (CAPA) in its report released late last month has also projected an increased profitability for the low-cost carriers from $200-220 million to about $300 million.
CAPA has also pegged Air India losses for the current fiscal at $750-800 million.