Indian airport profits set to surge by 35% amid strong demand, CAPA India reports

Indian airports are poised to see a significant increase in profits, with expectations of a 35% growth due to robust demand, according to aviation advisory and research firm CAPA India. Speaking at the CAPA India aviation summit in Delhi, CAPA India’s Vice President, Paramprit Singh Bakshi, projected that the industry’s pre-tax profit will rise to Rs. 10,370 crore, up from Rs. 7,680 crore the previous year.

However, the outlook is not as positive for Indian airlines, which CAPA predicts will experience a larger industry-wide loss in 2025. This is attributed to rising costs that outweigh increasing demand and higher ticket prices. CAPA India forecasts an overall increase in airline costs of 3.8% for the financial year 2024-25, largely due to a capacity crunch.

India, now the world’s most populous nation, aims to expand its airport infrastructure significantly, expecting to have 350 airports by 2030, up from 144 in 2019, based on CAPA India’s estimates and government data.

The previous fiscal year saw record domestic passenger traffic and a rebound in international travel, which benefited both airports and airlines. To address the capacity crunch, 84 new aircraft will be added this year, bringing the total fleet to 812, including grounded jets, up from 728 in March, according to CAPA India CEO Kapil Kaul.

Most of India’s airports are operated by the government-owned Airports Authority of India (AAI), with key private players including GMR Airports, the Adani Group, and Fairfax India, as reported by Reuters. Airport operators have enjoyed benefits from government-driven investments aimed at developing new terminals and refurbishing existing ones. Operator revenue is projected to grow by 14.8% this year, supported by steady domestic passenger growth and a swift rebound in international travel.

This optimistic outlook for airport profitability highlights the sector’s resilience and the ongoing efforts to expand and modernize India’s aviation infrastructure.

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