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Pratt & Whitney Canada inks deal with FLY91 for engine maintenance

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

Co-founded by erstwhile Kingfisher Airlines senior executive Manoj Chacko, the airline has been mandated to fly to and from Sindhudurg, Jalgaon and Nanded in Maharashtra, and Agatti in Lakshadweep, along with other business and leisure destinations such as Bengaluru, Goa, Hyderabad and Pune.

Global aerospace major Pratt & Whitney Canada (P&WC) said on Thursday, March 28, that it has signed a multi-year engine services agreement with FLY91 for the maintenance, repair and overhaul of the PW127M engines.

FLY91 is India’s latest airline based out of Goa and connects tier 2 and tier 3 cities.

Manoj Chacko, MD and CEO of FLY91 said, “The agreement with Pratt & Whitney Canada is a significant step in assuring we can provide our customers with dependable regional air travel from our base at Goa’s Manohar International Airport. We strongly believe that our ATR aircraft powered by P&WC’s PW127M engines will help us to achieve scalable air transportation services to build India’s regional connectivity.”

Irene Makris, Vice President, Customer Service, at Pratt & Whitney Canada, said, “The ability of a commercial aircraft to take off as scheduled often depends on the readiness and reliability of its engines. We have 40 years of experience in the maintenance of the PW100 engine family and we are confident we can help FLY91 enjoy excellent dispatch reliability for its ATR 72-600 fleet and fully meet passenger expectations.”

Co-founded by erstwhile Kingfisher Airlines senior executive Manoj Chacko, the venture, Just Udo Aviation Private Ltd, secured the Union Civil Aviation Ministry’s nod in April last year to start the airline under the brand name FLY91. The airline received its air operator permit from aviation regulator DGCA on March 6, 2024.

FLY91 recently commenced operations and currently has two ATR 72-600 in its fleet. It will be the first regional carrier to have been based out of the new Manohar Parrikar International Airport at Mopa in Goa. The startup carrier has already been allocated its first set of routes under the 5.0 phase of the government’s Regional Connectivity Scheme (RCS), UDAN.

As part of this, the carrier with the IC code has been mandated to fly to and from Sindhudurg, Jalgaon and Nanded in Maharashtra, and Agatti in Lakshadweep, along with other business and leisure destinations such as Bengaluru, Goa, Hyderabad and Pune.

The airline said it received its first ATR 72-600, one of the two aircraft leased from Dubai Aerospace Enterprise, which flew in from Hyderabad to be part of the regional airline’s fleet. In the long term, the airline plans to connect over 50 Indian cities in the next five years and induct a total of 30 aircraft.

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Tourism boom helped hotel stocks surge 100-150% in the past year. How will FY25 shape up?

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

In an interview with CNBC-TV18, Rajesh Magow, Co-Founder and Group CEO at MakeMyTrip and K Srikumar, Senior Vice President & Co-Group Head-Corporate Ratings at ICRA. discussed at length about how tourism shape will up in FY25.

Hotel stocks have been thriving post-pandemic and the rally in the space has further intensified after robust demand boosted occupancies across the segments. Almost all companies in the sector reported healthy operating margins in the third quarter of FY24, aided by strong demand.

The improvement in financial metrics is quite visible in the stock performance of hotels as well. A custom index of 12 hotel stocks has added as much as 1 lakh crore to its market capitalisation since the beginning of 2022. While the market valuation of Indian Hotels Co (IHCL) surged the most, with an increase of 54,212 crore over the last two years, others like EIH and Chalet Hotels saw their market valuation surge by 16,453 crore and 12,794 crore, respectively during the same period.

In an interview with CNBC-TV18, Rajesh Magow, Co-Founder and Group CEO at MakeMyTrip and K Srikumar, Senior Vice President & Co-Group Head-Corporate Ratings at ICRA discussed at length how tourism shape will up in FY25.

Magow said, “All segments of travel have come back, and not necessarily only leisure but the business segment, visiting friends and relatives (VFR), the pilgrimage tour and so on. And that is what, I guess, driving the stocks for the hotel industry as well.”

Also Read | Dubai announces 5-year multiple-entry tourist visa for Indian travellers: Know details here

Srikumar said that ICRA expects the hotel sector to grow at 14-16% in the current fiscal, FY24 and to the higher single-digit 7-9% in FY25; this is coming on a very high base.

“Occupancy levels are still at a decadal high of 70-72% which will be continuing in FY25 as well. The pan India premium hotel ARR (average room rate); the peak was seen in FY08 above 8,000 odd levels that will be hit in FY25 for the industry as a whole, although some of the portals have already crossed all-time high levels in FY24,” he added.

According to ICRA, hotels are experiencing steady growth because it will take some time for the number of hotels available to catch up with the demand. In the airline industry, domestic travel is predicted to return to pre-COVID levels only by fiscal year 2025, although international travel has already reached that point by fiscal year 2023. Tour operators are benefiting from the growth seen in hotels and airlines. However, they still face challenges such as visa issues. Overall, the tourism sector is expected to maintain its momentum and grow more significantly in fiscal year 2025.

In addition to the increasing wealth, there is also a newfound surge in religious or spiritual tourism, fueled by the construction of the Ayodhya temple. However, the tourism sector faces challenges, including the hike in tax collection at source from 5% to 20%, the low influx of foreign tourists into India, visa issues for Indians travelling to the United States, and geopolitical tensions such as those in Ukraine, Palestine, and the Maldives.

Also Read | Air India Express introduces Xpress Lite fares for budget-conscious travellers

In January 2024, hotels in India witnessed a healthy year-on-year (YoY) average room rate (ARR) growth of 11%, with occupancy increasing by 210 basis points compared to the previous year, resulting in a stronger YoY growth in revenue per available room (RevPAR) at 15%. Overall, for the first ten months of the fiscal year 2023-2024, ARR/RevPAR growth stood at approximately 15% YoY.

CRISIL Ratings forecasts that the Indian hotel industry is on track to achieve robust revenue growth of 11-13% in the fiscal year 2025, following a solid performance of 15-17% growth in the current fiscal year. This positive outlook is supported by consistent domestic demand and an increase in foreign traveller interest.

Also Watch: Prashant Pitti, one of the founders of EaseMyTrip, discussed with CNBC-TV18 the collaboration with Jeewani Group to develop a Radisson Blu Hotel with 150 rooms in Ayodhya. The company’s investment in this project is estimated to be around 100 crore.

For the entire discussion, watch the accompanying video

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Airlines, planemakers set to unveil new orders at Wings India event

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

India’s newest airline Akasa, due to start international flights in 2024, is expected to announce an order for about 150 Boeing 737 MAX narrowbody planes at this week’s aviation show, adding to recent record orders by bigger rivals.

Indian airlines and plane makers Boeing and Airbus will reveal new orders this week and showcase large jets as they look to cash in on a boom in a fast-growing aviation market with a greater focus on international routes.

As India sets its sights on becoming a regional aviation hub to rival Dubai and Singapore, the Wings India event in Hyderabad, running from Thursday to Sunday, is set to draw representatives of lessors and government as well.

“Air traffic, airports and fleet size are going to grow at a double digit growth annually in years to come,” Civil Aviation Minister Jyotiraditya Scindia told Reuters last week in response to a question on industry growth.

Although India is now the world’s fastest-growing aviation market, with travel demand outstripping the supply of planes, the bulk of international traffic is captured by global carriers such as Emirates.

India’s newest airline Akasa, due to start international flights in 2024, is expected to announce an order for about 150 Boeing 737 MAX narrowbody planes at this week’s aviation show, adding to recent record orders by bigger rivals.

It was not immediately clear if Akasa’s order included Boeing’s controversial 737 Max 9 planes, after a cabin panel blowout this month has put the planemaker in regulators’ crosshairs, adding to its safety crises.

Indian commercial airlines do not currently operate the 737 Max 9 aircraft.

The activity comes despite the financial struggles of two budget carriers GoFirst and SpiceJet, in the wake of the collapse of two other Indian airlines since 2011.

However, bankruptcies were a “thing of the past” and the growth of smaller regional airlines and government incentives to carriers to fly to smaller towns has sparked an industry boom, Scindia added.

India is investing close to $12 billion in building new airports and refurbishing existing ones, aiming to have about 200 airports within five years, up from 150 today.

Domestic passenger traffic is expected to surge to 350 million by 2030, from 152 million in 2023, while international travellers will grow to 160 million, data from aviation consultancy CAPA India and the government shows.

India has a fleet of about 700 aircraft, with orders pending for more than 1,500 planes by IndiGo, Air India and Akasa.

The figure points to the market’s appetite for growth, especially in the long-haul segment as international air travel increasingly comes into focus, Remi Maillard, managing director of Airbus India and South Asia, told Reuters.

At the Hyderabad event, Air India’s first Airbus A350 will be on display, alongside the world’s largest twin-engine passenger jet, the Boeing 777-9.

They are part of the Indian airline’s recent order book and will operate on its international network.

But many planes are also being ordered for the domestic market, risking an oversupply in the near term, that could make it tough for airlines to make money amid intense competition, analysts have warned.

Other risks to growth include snags with engines, and a shortage of pilots that could be worsened by government plans to curb flying times following protests about fatigue.

“Indian airlines will have a very busy 2024 on the international front, but we expect that the impact on financials may also be visible,” CAPA India said in a recent note.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Republic Day: Airspace curbs in Delhi for 11 days starting from today

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

Landing or take-off of non-scheduled flights of scheduled airlines, and chartered flights will not be permitted from 10 am to 1.15 pm during the January 19-25 period, the official said on Tuesday.

Airspace restrictions will be in place in Delhi for 11 days starting from Friday, January 19, in connection with the Republic Day preparations and celebrations, according to an official.

The restrictions will be in force till January 29 but it will not impact scheduled flights.

Landing or take-off of non-scheduled flights of scheduled airlines, and chartered flights will not be permitted from 10 am to 1:15 pm during the January 19-25 period, the official had said.

As per the NOTAM issued by the Airports Authority of India (AAI), these restrictions will be in force from 6 am to 9 pm during the period from January 26 to 29.

Generally, a NOTAM (Notice to Airmen) is a notice with information that is essential to personnel involved in flight operations. The official said the curbs will not impact the movement of scheduled flights of scheduled airline operators.

Besides, there will be no impact of NOTAM on IAF, BSF, Army aviation helicopter operations as well as state-owned aircraft/helicopters that are flying with the Governor/Chief Minister of a state.

Akasa Air had issued a statement saying some of the flights to and from Delhi, between January 19 and January 26, have been cancelled or rescheduled due to airspace closure. “We understand this may impact your travel plans and sincerely regret the inconvenience caused to you. In case your flight is impacted due to the above, you may request for a full refund for your existing booking or rebook an alternate available flight at no additional cost,” it said.

The Indira Gandhi International Airport (IGIA) in the national capital is the country’s largest airport and handles around 1,300 flights daily.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Akasa Air expands fleet to 22 aircraft in 17 months

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

Since commencing operations in August 2022, Akasa Air has set a global record by becoming the fastest airline to reach a fleet size of 20 aircraft within its first year.

Akasa Air, India’s newest aviation player, has grown its fleet to 22 aircraft in 17 months, including the recent addition of two Boeing 737 MAX 8s. The airline’s current fleet includes 21 Boeing 737 MAX 8s and one Boeing 737 MAX 8 200.

“Akasa Air’s remarkable growth testifies the sheer promise that India holds as an aviation market. The additions to our fleet will help us bolster the strength of our operations as we expand our footprint and foray into international skies in the coming months. Each addition to our fleet brings us closer to our purpose of connecting people, places, and cultures, and we hope that as we step into the next phase of growth, we will be able to serve millions of satisfied travelers across the globe,” Vinay Dube, Founder & CEO of Akasa Air, stated in a release.

Since commencing operations in August 2022, Akasa Air has set a global record by becoming the fastest airline to reach a fleet size of 20 aircraft within its first year. The airline has already served over 6.3 million passengers, connecting 17 Indian cities. It is poised to announce the start of international operations, focusing on the Western Asian region.

November 2023 data from the Directorate General of Civil Aviation (DGCA) shows Akasa holding a steady 4.2% market share since August 2023 against IndiGo’s 60% and Tata Group airlines’ combined 26%. Earlier in the year, the airline briefly surpassed SpiceJet in market share for two consecutive months from June to July. However, it was later hit by the abrupt departure of about a tenth of its pilots and had warned it was flying less as a result, costing it market share, Sources from the airline indicate plans to resume many flights shortly.

The Indian budget carrier is expected to close an order for around 150 Boeing 737 MAX narrowbody planes soon, per a Reuters report.  The additions will aid its domestic and international expansion, with the narrowbody Boeings equipped to fly to nearby foreign destinations like Southeast Asia and the Middle East from India.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Indian Aviation in 2023: A year of steady ascent amidst challenges

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

The aviation sector in 2023 experienced a blend of highs and lows: while rising passenger numbers and record aircraft orders showcased industry growth, challenges like GoFirst’s grounding, IndiGo’s engine problems, SpiceJet’s financial and legal difficulties, and Akasa Air’s pilot issues marked significant setbacks.

The Indian aviation sector had a fairly smooth ride in 2023, albeit with some turbulence. The year was marked by achievements such as the soaring passenger traffic, and record aircraft orders from major players like IndiGo and Air India, but it also saw the grounding of the Wadia group-backed GoFirst due to engine troubles, similar technical concerns at IndiGo, financial and legal hurdles at SpiceJet, and pilot-related issues at the nascent Akasa Air.

IndiGo, India’s largest airline by market share and fleet size, had a momentous year. The airline kickstarted 2023 by becoming the first in the country to boast a fleet of 300 aircraft in January. Later, it achieved another milestone by inducting two widebody aircraft on wet lease from Turkish Airlines, complete with IndiGo’s livery – a first for the airline. The company’s expansion was further underscored by its record-setting order of 500 A320 family aircraft from Airbus at the Paris Air Show, marking the largest deal in commercial aviation history. This growth was mirrored in its network expansion, reaching 85 domestic and 33 international destinations. IndiGo also distinguished itself by operating more than 2,000 daily flights, a first in Indian aviation, while maintaining healthy profits for four consecutive quarters.

Despite these successes, the year wasn’t without its challenges. The airline faced technical issues with Pratt & Whitney engines, leading to the grounding of 40 aircraft in the first half and an anticipated 30 more in the fourth quarter of the financial year. To mitigate this, IndiGo is extending current leases and acquiring additional aircraft. Looking ahead to 2024, the airline expects to welcome a new aircraft every week. However, it must navigate hurdles such as high aviation turbine fuel (ATF) prices and the ongoing impact of the grounded aircraft, which pose significant challenges for the upcoming year.

Also Read | Indian airlines likely to prune losses to 3,000-5,000 crore this fiscal: ICRA

2023 was also a landmark year for Tata Sons-backed airlines Air India and Vistara. Air India embarked on a major transformation, unveiling a new brand identity and replacing the iconic Maharaja logo. This change was part of a comprehensive overhaul, highlighted by an order of 470 aircraft from Airbus and Boeing. Additionally, the competition watchdog approved the merger of Air India and Vistara, setting the stage for a major full-service carrier in India.

Air India faced its share of challenges as well, including passenger misconduct incidents, fines from the Directorate General of Civil Aviation (DGCA), and frequent technical issues, particularly on international flights. However, despite these setbacks, the airline expanded its routes, adding and resuming several international destinations. A historic moment came later in the year when Air India began receiving aircraft from its massive order, including the first Airbus A350-900 widebody aircraft, a first for Indian aviation. During the year, the Tata Group also merged low-cost carrier Air Asia India with Air India Express under a new brand identity. Looking ahead to 2024, it’s set to be a year of fleet expansion for both the full-service and low-cost arms of the Tata Group’s aviation ventures.

The year was not as memorable for the Wadia Group-backed GoFirst. In May, the airline announced voluntary insolvency driven by increasing losses due to delays in the delivery of Pratt and Whitney’s engines, which substantially affected the airline’s operations. As the year progressed, GoFirst encountered severe operational difficulties, with 50% of its fleet grounded – a dramatic increase from 7% in December 2019 and 31% in December 2020. The financial impact was significant, with the airline accruing losses around ₹10,000 crore. The dire situation led to an uncertain future for its thousands of employees, with many leaving due to unpaid salaries, reducing the staff to approximately 100-200 people, including a smaller number of pilots.

The airline also has substantial debts, owing over ₹11,000 crore to banks and lessors. This has led to complex legal proceedings at the National Company Law Tribunal (NCLT). Despite lessors filing for de-registration requests with the DGCA, their efforts to repossess aircraft are affected by ongoing legal cases. Throughout the year, there were moments when the airline appeared on the verge of resuming operations, even conducting test flights, but these hopes were fleeting.

Also Read | Check which airline topped on-time performance in November 2023: Indigo is not No 1

Naveen Jindal’s Jindal Power (JPL) initially showed interest by submitting an Expression of Interest (EOI) for the airline, but later retracted it. The Wadias, the primary backers of GoFirst, have shown no interest in reclaiming the airline, and the deadline for submitting EOIs has now passed. The resignation of CEO Kaushik Kona added to the airline’s woes.

However, there appears to be a new glimmer of hope. Ajay Singh-backed SpiceJet, and SkyOne have both expressed interest in GoFirst. They have approached the resolution professional with requests to extend the lapsed EOI deadline. Meanwhile, GoFirst has prolonged the suspension of its flight operations until February 4, 2024, leaving the airline’s future uncertain.

For SpiceJet, the year was dotted with hits and misses. In the early months, the airline faced a significant financial scare, exacerbated by the ongoing issues of grounded aircraft. Legal entanglements were also a constant, with ongoing cases involving aircraft and engine lessors in the NCLT and Delhi High Court. The airline’s priorities were focused on managing these challenges, which included arranging finances and forming new partnerships with engine and aircraft lessors. Efforts were also directed towards reactivating its grounded fleet.

The latter part of the year, however, marked a turning point. Financial support began flowing in, starting with a ₹500 crore investment from the airline’s promoter, Ajay Singh. A major financial breather came in December 2023 when its board green-lit a substantial fundraising initiative. It managed to secure ₹2,250 crore from 64 entities.

As part of its plan to acquire GoFirst, the airline laid out a strategic plan to raise ₹2,241 crore in two phases to purchase, with the first tranche of ₹1,591 crore planned by June 2024 and the second tranche of ₹650 crore by June 2025. This acquisition, if successful, could significantly bolster SpiceJet’s fleet and market position, potentially increasing its market share to an impressive 25%, a move that would reshape its standing in the Indian aviation sector.

For India’s newest aviation player, Akasa Air, the initial journey was relatively smooth until it hit a significant obstacle. Celebrating its first anniversary in August, Akasa Air had an impressive start, becoming the fastest airline globally to amass a fleet of 20 aircraft within its first year of operations. This rapid expansion made it eligible to commence international flights, an endeavor that is already in the planning stages.

However, just as things seemed to be progressing smoothly, the airline faced a major setback when around 43 pilots, constituting nearly 10% of its entire workforce, abruptly resigned. These departures, believed to be due to poaching by other airlines, caught Akasa Air off guard. The airline sought intervention from the Ministry and the Directorate General of Civil Aviation (DGCA), but their request for immediate action couldn’t be fulfilled.

The situation escalated as the mass resignation violated DGCA norms, leading to legal actions in both the Delhi and Bombay High Courts. Akasa Air pursued legal recourse against the pilots for breach of contract, seeking substantial compensation for the disruptions caused. This exodus of pilots raised concerns about the airline’s operational stability, with fears of potential shutdown if such exits persisted. As a result, about 18% of the 3,500 scheduled flights were canceled, significantly impacting the airline’s growth trajectory.

Fortunately for Akasa Air, the Delhi High Court intervened, affirming the DGCA’s authority to act against pilots who fail to adhere to Civil Aviation Regulations (CAR). This decision offered some relief to the airline, which now considers the issue a thing of the past and is focusing on its future. With plans for expansive growth and a triple-digit aircraft order, Akasa Air seems back on track to expand its foothold in the aviation industry.

Also Read | International Civil Aviation Day 2023: History, significance and theme

Outlook for financial year 2025

ICRA projects 8-14% growth in domestic traffic momentum in FY25 with the potential for grounding of 20-24% industry capacity. This will lead to increased lease rentals, damp leases and increased lease rates, lower fuel efficiencies. “Couple of airlines saw shutdown in recent past. There is a higher credit risk for Indian aviation.” Kinjal Shah, VP & Co-Group Head – Corporate Ratings, ICRA told CNBC-TV18.

Heading into 2024, the Indian aviation sector faces several challenges, with elevated Aviation Turbine Fuel (ATF) prices, supply chain disruptions, a depreciating rupee against the US dollar, and the ongoing impact of grounded aircraft being the primary headwinds. The Center for Asia Pacific Aviation (CAPA) forecasts a concerning scenario with up to 200 aircraft potentially grounded by the end of the current financial year.

Despite these challenges, 2024 also holds promise for the sector. Major airlines like IndiGo, Air India, and Akasa Air are expected to receive a continuous influx of new aircraft, boosting operations and capacity. SpiceJet, too, is expected to follow through on its pending orders with Boeing, which could further strengthen its fleet. There is also hope that GoFirst will resume operations and rejoin the skies.

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Plane grounded in France over human trafficking lands in Mumbai

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

According to French authorities, the plane had 276 passengers on board when it took off for Mumbai, as 25 persons, including two minors, had expressed the wish to apply for asylum and were still on French soil.

A charter plane carrying 276 passengers, mostly Indians, grounded in France for four days over suspected human trafficking, landed in Mumbai in the wee hours on Tuesday, an official said.

The aircraft, an Airbus A340, landed in Mumbai shortly after 4 am, the official said. It had taken off from Vatry airport near Paris around 2.30 pm local time.

According to French authorities, the plane had 276 passengers on board when it took off for Mumbai, as 25 persons, including two minors, had expressed the wish to apply for asylum and were still on French soil. Two others were held and produced before a judge , who were brought before a judge, were released and placed on assisted witness status, a French news channel said.

When the flight landed in Vatry airport, there were 11 unaccompanied minors among the 303 Indian passengers on board, a local official had said.

Makeshift beds were arranged for the stranded passengers, who were given access to toilets and showers and provided meals and hot drinks in the hall of Vatry airport, the official had said.

The flight, which was operated by Romanian charter company Legend Airlines and bound for Nicaragua, had landed at Vatry on Thursday for a technical stopover en route from Dubai when French police intervened.

French authorities launched a judicial investigation into the conditions and purpose of the trip, with a unit specialising in organised crime investigating suspected human trafficking.

Nicaragua has become a popular destination for those seeking asylum in the US. As many as 96,917 Indians attempted to enter the US illegally in the financial year 2023, signalling a 51.61 percent jump from the previous year, according to data made available by the US Customs and Border Patrol (CBP).

At least 41,770 of those Indians attempted to enter the US via the Mexican land border, CBP data shows. Flights to Nicaragua or third countries where obtaining travel documents is easy have come to be known as ‘dunki’ flights.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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Rising crude oil prices could eat into the festive profit of Indian companies

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Summary

In an interaction with CNBC-TV18, Harsha Upadhyaya, Chief Investment Officer at Kotak Mahindra Asset Management Co. pointed out that while overall sentiment for the Indian market continues to remain positive from a medium-term perspective, investors should keep an eye on crude oil. Crude oil prices have risen nearly 6% since the Israel-Hamas conflict first began ten days ago.

In an interaction with CNBC-TV18, Harsha Upadhyaya, Chief Investment Officer at Kotak Mahindra Asset Management Co. pointed out that while overall sentiment for the Indian market continues to remain positive from a medium-term perspective, investors should keep an eye on crude oil.

“Crude has moved up and there could be some pressure on margins,” he said, adding that there could be further pressure on oil prices if the Israel-Hamas conflict escalates and is no longer a local conflict.

“We have seen a 30% rise in crude prices over the last 3 months, from $70 to $90 a barrel. So there has already been an increase. This will flow into margins over the next 1-2 quarters with a lag,” he said.

Also Read: Can stocks keep rallying with the rise in oil prices?

Crude oil prices have risen nearly 6% since the Israel-Hamas conflict first began ten days ago. Analysts back home are in a wait-and-watch mode as any escalation of the conflict can lead to a significant impact on margin across oil-dependent sectors such as auto, aviation, and paints, among others.

How rising oil prices could impact businesses 

In a report released on October 9, Axis Capital noted that oil marketing companies are likely to be worst affected due to a spike in oil prices. Auto-fuel gross marketing margin has already dropped from a strong Rs 10.2 per litre in the first quarter of FY24 to Rs 2.1 a litre in the second quarter and to Rs 0.8 a litre on a spot basis. Axis expects this to adversely impact the earnings of oil marketing companies in the second half of the current financial year.

“Airlines like Indigo lose 20% of their earnings, and paints and tyres manufacturers may lose 4-7%, if oil prices rise $5 a barrel. FMCG companies are also likely to be affected (through detergents and via packaging) and are likely to pass on price increase but at the cost of volumes,” the Axis report stated.

Source: Company, Axis Capital Estimates

Crude prices have impacted the price of Styrene, a crude oil byproduct and a solvent used in making reinforced plastic fabrications, pipes and automobile body parts. Prices of Styrene have risen nearly 26% over the last three months.

The prices of daily-use items such as soaps, toothpaste, hair oil, etc. have also been on a steady uptrend over the past couple of months.

Nomura estimates that every 10% increase in oil prices can raise the fiscal cost by 0.2% of GDP in India, assuming the government bears the entire loss.

Broad market outlook

Upadhyaya said that earnings delivery remains an important factor that will drive market sentiment. He expects earnings for large caps to grow in the mid-teens. However, small- and mid-cap stocks could be at more risk of a correction if things don’t pan out as expected, he said.

“In large caps, we do not see too much earnings risk. Over the next 2 years, we expect about 16-17% earnings CAGR. Even in a worst-case scenario, there is not so much valuation discomfort in that basket. However, in small and mid-caps the earnings CAGR is about 25% for the next 2 years and valuations are at a premium to large caps as well as the segment’s historical average. If at all there are risks to earnings delivery it will be in mid- and small-caps,” he noted.

For more details, watch accompanying video

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

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today's market

index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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No delay by DGCA in issuing pilot licences: Aviation ministry

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

 Listen to the Article (6 Minutes)

Summary

The clarification comes amid reports that DGCA is taking two months to issue licences to trained pilots due to staff shortage. 

The Aviation Ministry on Thursday (September 21) dismissed reports alleging staff shortage at the Directorate General Of Civil Aviation (DGCA), causing delays in issuance of commercial licence to pilots.

The Ministry clarified that the DGCA is meeting indicative timelines and issuing commercial pilot license in 20 to 30 working days despite an increase in the number of applications.

“The indicative timelines published for Issue & Conversion of Commercial Pilot License (CPL) by DGCA is 20 & 30 working days respectively. DGCA has been meeting the indicative timelines despite an increase in number of applications. Average timelines achieved for applications during 2023 for  CPL Issue & Conversion is 22 and 31 working days,” the DGCA said.

The clarification comes amid reports that DGCA is taking two months to issue licences to trained pilots due to staff shortage.

The Ministry stated that the DGCA has 15 posts designated for flight crew and licensing against which 12 officers are currently posted.

“On the issue of staff position at DGCA, it is clarified that the total sanctioned strength of Operations Cadre in DGCA is 228. These 228 posts are spread across various Directorates in DGCA, which perform various regulatory functions such as flight crew licensing and examination, ATCO licensing etc. Of these 228, the sanctioned strength of Technical Manpower in Flight Crew  Licensing Directorate in DGCA HQs is 15, against which 12 officers are currently posted,” the DGCA added.

The Ministry highlighted that pilots’ applications where prompt compliances are ensured by the applicants are approved faster while some applications take more time as the applicants are not able to adhere to compliances laid down by the DGCA.

“As on date 25 applications are in process with DGCA. 7 applications have crossed the threshold of 60 days, of which in five applicants are yet to respond to DGCA observations. In the remaining two cases, approvals are expected to be granted by the end of the month provided all requirements are complied with,” the aviation regulator stated.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

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index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
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150 more Go First staff resign in 2 weeks, exodus to continue if salaries delayed: Sources

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

 Listen to the Article (6 Minutes)

Summary

Go First employee exodus: The airline’s resolution professional had earlier this month sent an email to employees saying that Go First’s cash flows have been impacted due to challenging circumstances

Even as grounded airline Go First struggles to restart operations, it faces another roadblock as employees, upset at not having received their pay for three months, have started looking for jobs elsewhere.

“Employees are frustrated as salaries have not been paid for May, June and July, despite promises of retention bonuses and a quick restart,” a senior executive working with the airline told Moneycontrol.

He added that after the initial rush for the exit May, there was a tapering off in the attrition rate. “Around 20 people would quit every week, but that was expected. Most employees with five-plus years of experience with the airline were standing with the airline,” the executive said.

But since the beginning of this month, he said, employee dissatisfaction has only grown and there has been an increase in resignations.

“Around 150 employees, including 30 pilots, 50 cabin crew members and 50 ground handling and engineering employees, have put in their papers in the last two weeks,” another executive working with the airline said.

The second executive said that employee sentiment has been badly hit after the Supreme Court on August 7 refused to entertain Go First’s appeal against a Delhi High Court order that allowed lessors to inspect and carry out maintenance work on their 30 leased aircraft twice a month.

Emails sent to Go First remained unanswered at the time of publishing.

A third executive said that if salaries are not paid to employees soon, a rash of resignations is expected. “None of the departments has been paid for three months now, employee sentiments are at an all-time low and a mass exodus is expected,” this executive said.

The airline’s resolution professional had earlier this month sent an email to employees saying that Go First’s cash flows have been impacted due to challenging circumstances.

“We are working tirelessly to resolve these challenges and restore normalcy as early as possible,” Shailendra Ajmera said in the email.

Similarly, Go First Chief Executive Officer Kaushik Khona had said that salaries would be paid by August 10 but employees Moneycontrol spoke to confirmed that salaries have not been paid.

During the employee interaction earlier this month, Khona noted the challenges faced by the airline in getting its funds parked with banks. He pointed out that Go First has been unable to access Rs 5 crore and Rs 35 lakh from the Central Bank of India and IDBI Bank, respectively.

Khona also said the airline was lucky to secure Rs 56 crore in the past few months despite zero operations and this amount was used to pay insurance premiums and salary advances.

On June 26, the Committee of Creditors (CoC), which include Central Bank of India , Bank of Baroda, Deutsche Bank, and IDBI Bank approved the request for additional funding worth Rs 400 crore.

Last week, stressed unpaid employees who were left with doubts went to the Andheri East, Mumbai headquarters of Go First to seek some answers but Ajmera was not in office.

The beleaguered low-cost airline has also sought emergency funding of Rs 100 crore from its lenders to keep itself afloat and to meet mandatory liabilities such as insurance. The funding will be used by the airline for critical expenses, Ajmera told the committee of creditors.

Go First on May 24 informed its employees that the April salary would be fully paid to them before the carrier restarts operations. “The CEO has assured that the salary for the month of April will be credited to your account before the commencement of operations. Furthermore, from the coming month, the salary will be paid in the 1st week of every month,” Captain Rajit Ranjan, Go First vice president, flight operations, had said in an email sent to the employees.

Go First had around 7,000 employees at the time it declared voluntary bankruptcy on May 2. The Wadia Group-owned airline halted operations and applied for insolvency resolution citing a financial crunch due to the absence of engines and spares that have grounded half of its fleet.

The airline also sought interim directions to restrain lessors from taking back aircraft and the regulator from taking adverse action against it.

Khona had in May told Moneycontrol that Go First was burning about Rs 200 crore every month since November and could no longer afford it and had to file for insolvency before the National Company Law Tribunal.

The airline hopes to resume operations as soon as possible. Khona said Go First needs at least 20 aircraft to return to service and break even on daily operations.

The airline blamed Pratt & Whitney for supplying faulty engines and failing to replace them in a timely manner, resulting in half of its 54 aircraft fleet being grounded.

In May the airline had moved a plea before a court in Delaware, United States, seeking enforcement of an order issued by the Singapore International Arbitration Commission (SIAC) against American aerospace manufacturer Pratt & Whitney.

Go First, in the emergency petition moved before the Delaware Federal Court on April 28, called for a legal order to force Pratt & Whitney to comply with SIAC’s two arbitral awards, issued on March 30 and April 15.

The SIAC had, on March 30, ordered Pratt & Whitney to provide Go First with at least 10 serviceable engines by April 27, 2023, and the remainder by the year-end.

Go First will be able to return to full-scale operations by September 2023 if Pratt & Whitney provides the airline with the engines, as stipulated in an arbitration order, Khona noted.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

 Daily Newsletter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Previous Article

Oil Fluctuates as Traders Assess China’s Vow, Unrest in Libya

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today's market

index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -72.15
sensex ₹1,882.60 +28.30
nifty IT ₹2,206.80 +30.85
nifty bank ₹1,318.95 -14.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95
index Price Change
nifty 50 ₹16,986.00 -7.15
sensex ₹1,882.60 +8.30
nifty IT ₹2,206.80 +3.85
nifty bank ₹1,318.95 -1.95

Currency

Company Price Chng %Chng
Dollar-Rupee 73.3500 0.0000 0.00
Euro-Rupee 89.0980 0.0100 0.01
Pound-Rupee 103.6360 -0.0750 -0.07
Rupee-100 Yen 0.6734 -0.0003 -0.05
Quiz
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Are you a Crypto Head? It’s time to prove it!
10 Questions · 5 Minutes
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Win WRX (WazirX token) worth Rs. 1500.
Question 1 of 5

What coins do you think will be valuable over next 3 years?

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Should Elon Musk be able to buy Twitter?