Monthly data by the Directorate General of Civil Aviation shows that the number of passengers carried by domestic airlines in February stood at 12 million. This is lower than the pre-covid levels (February 2020) by only 2%. But also note February 2020 had an extra day as it was a leap year.
The momentum can be expected to continue this month as well. According to ICICI Securities Ltd, average daily passengers in March so far stood at 426,000 (largely in line with February 2020 levels) versus 423,000 in February 2023. The broking firm said considering average daily departures have risen sequentially in March, passenger load factors should also remain healthy.
In this backdrop, the March quarter is likely to be strong for listed airlines such as InterGlobe Aviation Ltd and SpiceJet Ltd. InterGlobe runs IndiGo, India’s largest domestic carrier by market share. However, while the yield would remain healthy, it is expected to show the impact of seasonality as the December quarter (Q3FY23) is the strongest for aviation. Yield is a measure of pricing.
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