"Mumbai Tata Group Airlines Post ₹15,532-Crore Loss in FY2023: Air India Express Reports Net Profit"

2023-08-09 15:32:36

Tata group-owned airlines collectively posted ₹15,532-crore loss in FY23, Tata Sons’ annual report for the year showed.

This compares to ₹13,838-crore net loss in the previous year. All the group airlines reported year-on-year revenue growth due to phasing out of all pandemic restrictions. The collective loss figure was higher due to over ₹5,000-crore provisioning by Air India on account of grounded planes and engines.

Only Air India Express (AI Express) reported a net profit of ₹116.84 crore while three other group airlines – Air India, AirAsia India, and Vistara – posted a loss during the last fiscal year. In FY22, AI Express had made a net loss of ₹73 crore – its first negative result in seven years.

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Tata Sons took over Air India and its two subsidiaries, including AI Express, last January. AirAsia India and Vistara are separately owned by the group. As such their results are also reported separately.

Since the acquisition of Air India, the group has infused considerable funds to turn around the airline, improve products and services. The network too has been expanded with the launch of new routes.

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While the cost pressure has increased for airlines due weakening rupee and an increase in aviation turbine fuel price, the airlines benefitted by a surge in demand. Overall passenger traffic handled by Indian airports rose 73 per cent in FY23 on a year-on-year basis.

The closure of Russian airspace for US and European airlines limited capacity between India and North America. Air India benefitted by adding flights and increasing fares. As such its revenue rose to ₹31,377 crore. However, loss increased from ₹9,556 crore to ₹11,387 crore in the same period on account of an impairment.

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Air India did not immediately respond to a query on the same.

AIX Connect Private Ltd, which operates AirAsia India, also saw an increase in net loss. Net loss for the period widened 26 per cent to ₹2,750 crore despite 2.2x growth in revenue to ₹4,310 crore in FY23.

Vistara’s net loss declined 31 per cent to ₹1,393 crore in FY23 with 2.25x growth in revenue to ₹11,784 crore. Vistara declined comment on its performance.