Industry Profile: The civil aviation industry in India has emerged as one of the fastest-growing industries in the country during the last three years. India is currently considered the world’s third-largest domestic civil aviation market. India is expected to become the world’s largest domestic civil aviation market in the next 10 to 15 years, as per Mr. Jayant Sinha, Union Minister of State for Civil Aviation, Government of India. According to International Air Transport Association IATA, India will displace the UK for third place in 2025. The Civil Aviation industry has ushered in a new era of expansion, driven by factors such as low-cost carriers (LCCs), modern airports, Foreign Direct Investment (FDI) in domestic airlines, advanced information technology (IT) interventions, and growing emphasis on regional connectivity.
As of December 2017, the existing fleet of aircraft stands at 548 aircraft in India, and another 920 aircraft are expected to be inducted into the fleet by 2025.
According to Morgan Stanley, India is estimated to see an investment of US $25 billion in the next decade in the airports sector and traffic growth of 13 percent. According to them, the share of air travel in air and rail travel combined in India will grow to 15.2 percent by 2027 from 7.9 percent now. Capex plans to the tune of Rs 65,000 crore (US$ 10.08 billion) have been finalized by the Airports Authority of India with Rs 17,500 crore (US$ 27.13 billion) for the next five years and around Rs 22,000 crore (US$ 3.41 billion) for brownfield expansion in Delhi, Mumbai, Hyderabad, and Bengaluru by private operators and around Rs 21,000 crore (US$ 32.55 billion) for greenfield airports.
Company Profile: The Company operates in the aviation sector, mainly in domestic aviation. The Company is famous for its Low-cost asset-light model of Aviation and is a leader in the domestic segments under Indigo brands. The Company offers aviation, hospitality, and travel-related services. It is the largest airline in India by passengers carried and fleet size, with a 39.7% market share as of January 2018. It is also the most significant individual Asian carrier in terms of jet fleet size and passengers carried and the Seventh largest carrier in Asia, with over 46 million passengers in 2017. The airline operates to 50 destinations, both domestic and international.
Shareholding Pattern: BSE Data
FInancials and ratios : [table id=115 /]
Future prospectus: Beyond a doubt, this sector is excellent. but corporate governance is also “great.” Before listing huge dividends. Personal fight among Promoters. Covid is one issue for the whole economy but is the biggest for aviation. SEBI above the limit decides a high percentage of promoter shareholding. The asset-light model is good, but when Management is not ready to answer questions. I don’t want to sound very bad, but I believe this Company is rigged in the hands of the promoter. Yes, so many Brokerages are bullish, and Funds are buying, but I am keeping My negative view.
