IA profits may fall short of target

According to IA sources, some of the routes identified are the Delhi-North-East, Chennai-Tiruchi and Delhi-Chandigarh routes. The decision has been taken to improve capacity utilisation and therefore, profitability of the airline.

The officials point out that if that estimate has to be achieved, it would even be more profitable to ground aircraft than fly them consistently at a 60 per cent seat utilisation.

According to some estimates, the airline has recorded a loss of Rs 7.60 crore for the April-November period, owing to a mere 1 per cent growth in passenger traffic this year against the IA projection of 6 per cent and the Planning Commission projection of 10 per cent growth in the aviation industry. Airline officials, however, insist that there was actually a marginal profit of Rs 2 crore.

For the April-June period, the airline recorded a profit of Rs 9 crore while for the July-September period, it recorded a loss of Rs 22 crore. There was a slight recovery in October when it recorded Rs 45 lakh profit and in November when it recorded Rs 15 crore profit.

Against the projected daily traffic of 35,000, the first half of the year saw traffic of only 28,000, of which private airlines carried 10,000 with the remaining flying Indian Airlines. The CMD of IA, P C Sen has attributed the poor performance to the general recession in industry and the unstable political climate that had acted as a dampener to growth in passenger movement.

IA has fallen short of the targetted operating revenue by Rs 17 crore and of the operating profits by Rs 37 crore. While the industry is not expected to improve greatly, the airline has projected profits of Rs 15 crore for January, Rs 12 crore for February and another Rs 15 crore for March.