Domestic air traffic growth likely to shrink 15-17% in April

By Livemint

Domestic air passenger traffic growth is likely to contract 15-17% in April as the spike in covid-19 infections and fresh restrictions imposed by states are set to delay recovery in travel demand, rating agency Icra said in a report on Wednesday.

“Post resumption of airport operations from 25 May 2020, the ramp up in domestic passenger traffic had been steadily reaching 64% of previous year levels in February 2021. Considering a similar trend, domestic traffic was expected to grow at 125% in FY2022 after an estimated de-growth of 61% in FY2021,” it said.

However, the spike in covid-19 cases towards March end and early April has resulted in several state governments implementing fresh restrictions, it added.

While passengers are apprehensive about air travel, mandating negative covid-19 test reports for travel and imposing mandatory home quarantine measures are expected to adversely impact passenger traffic in April.

The fresh restrictions will also have an adverse bearing on airport operators’ cash flows and debt coverage metrics.

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