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Higher costs and Covid curbs to weigh on airline profitability, revenues

Comfort of cheaper turbine fuel evaporates as crude prices hit highest level since March

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The bigger worry is the impact on revenue due to the concerns related to second wave of the pandemic in some states

Ram Prasad Sahu
Stocks of airlines InterGlobe Aviation (IndiGo) and SpiceJet fell 2-4 per cent on Wednesday on worries that a possible second wave of Covid-19 infections in key states such as Maharashtra and jump in crude oil prices could hurt revenues and profitability. The two largest private carriers have been struggling to improve their load factors after the government allowed them to operate domestic flights from the last week of May.

Though capacity restrictions have been lifted gradually, airlines can only operate at 70 per cent of the pre-Covid capacity on domestic routes. While lower load factors and passenger traffic have weighed on

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First Published: Nov 25 2020 | 8:17 PM IST

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