New Delhi, Jun 10 (FN Bureau) Hit by second wave of COVID-19 air traffic is expected to slump in fiscal 2021-22 and fully recover only by fourth quarter of next fiscal, said credit rating agency CRISIL in a press release on Thursday. “A raging second wave has resulted in localized lockdowns, night curfews and other restrictions on movement of people. Consequently, passenger traffic at airports has nosedived, with average daily domestic passenger traffic halving in May 2021 from February 2021, or to a mere 10 per cent of pre-pandemic levels seen in May 2019,” the release added. “Despite that the credit quality of airport operators will continue to be supported by strong business models and healthy liquidity covers amid low debt servicing requirements this fiscal.”
CRISIL’s prediction is based on an analysis of the top four private airports – Delhi, Mumbai, Bengaluru and Hyderabad, accounting for around 90 per cent of air passenger traffic handled by private airports in India and 50 per cent of all air traffic last fiscal. “Second wave will push back revival of business travel and pick-up of international traffic, which account for over half of overall traffic. We now expect traffic volumes this fiscal to be around 60 per cent of fiscal 2020 levels and recovery to pre pandemic levels happening only by fourth quarter of fiscal 2023,” Manish Gupta, Senior Director, CRISIL Ratings said.
After a complete ban on scheduled passenger flight for two months last year domestic scheduled operations were resumed on May 25, 2020. Total passenger traffic reached to 60 per cent of fiscal 2020 levels by February 2021. CRISIL said it expects much faster recovery this time based on the ongoing vaccination drive, push from government to limit the economic impact and recovery trajectory seen in countries that have emerged from a second wave. Still the normalization in India is expected only by fourth quarter of fiscal 2023.