Aviation

Indian airlines risk consolidation, plane repossessions amid Covid-19 surge

By Times Now

India’s airlines are under renewed pressure to raise cash or face the risk of having to downsize, consolidate or have their planes repossessed by lessors as a surge of Covid-19 infections roils travel.

Passenger traffic fell by nearly 30% in April from a month before and has halved again so far in May, forcing even the country’s biggest and most cashed-up carrier, IndiGo, to prepare for action.

IndiGo’s parent, Interglobe Aviation, will meet on Friday to consider an equity raising, just months after it abandoned plans to raise up to Rs 4,000 crore ($543 million) in January in response to a speedy recovery in travel.

With traffic plummeting, according to aviation ministry data, IndiGo’s cash burn is expected to rise to $3.4 million a day – a level last seen in September – from $2 million a day at the end of 2020, an analyst who tracks the company said.

This means IndiGo, which has more than a 50% share of the market, may look to raise $543 million to $679 million amounting to at least two quarters of cash burn, said the analyst, who declined to be named as he was not authorised to speak publicly.

Facebook Comments

Source
Times Now
Show More

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button
Close
Close