INDIAN CIVIL AVIATION INDUSTRY

Industry Overview

Currently India is 9th largest civil aviation market in the world Scheduled air services available to/from 82 airports 1356 International flights utilizing 3,26,705 seats per week Boeing predicts that India will require 1320 aircrafts valued at US$150 billion over the next 20 years Bilateral with 104 countries Enhanced national and international connectivity - 72 foreign airlines are operating to/from various destinations Expected to grow at a rate of 9-10% annually from 55.32 Million to reach the level of 150 to 180 million passengers by 2020 As per domestic passenger volume India now ranks 4th after US, China and Japan 14 scheduled airlines operating exclusive of cargo airlines

Indian Civil Aviation Industry• Vision:

Enable people to have access to safe, secure, sustainable, and affordable air services in world class civil aviation

• Mission:

To create World Class infrastructural facilities To establish Regulatory Framework in consonance with

international standards Connect presently unserved or underserved areas Develop skilled manpower according to the needs of the

industry Deploy advanced technologies for the optimal growth of the

sector

MARKET SIZE

Market Size

Domestic Air Traffic quadrupled from 13 million to 52 billion in last decade

International Traffic more than tripled to 38 million 87 foreign airlines fly to and from India and 5 Indian

airlines fly to and from 40 countries 45 million tons of cargo through 920 airlines, using

4200 airports and deploying 27000 aircrafts Projections for traffic during the Eleventh Five Year

Plan, which shows increase in passenger traffic (i.e. 18.8%) as compared to cargo (i.e. 11.4%). The figure is as follows:

Market Size Contd…….

MARKET PLAYERS

Market Players

Air India – Reported a loss of 6,994 crores in FY 2010-11 Jet Airways – Reported a loss of 86 crores in FY 2010-11 Kingfisher – Reported a loss of 1027 crores in FY 2010-11 Indigo – Reported a profit of 650 crores in FY 2010-11, 18%

jump in profit over FY 2009-10 Spice Jet, GoAir and all other LCCs reported a net loss in FY

2010-11

Market Share

Source: Director General of Civil Aviation

Market Share Contd……

Market Share Contd……

OPERATING PERFORMANCE

Operating Performance

Performance Contd…..

Performance Contd…..

Performance Contd…….

Trying to keep itself afloat

All the Airlines reported an increase in revenue of around 20% Civil Aviation Industry reported a passenger growth rate of 17.7% All the Airlines except Indigo reported a loss for FY 2010-11 Could anybody of you answer this question?

Solution to the problem

Spiraling jet fuel prices and a high interest rate regime in 2011 threatened the survival of some domestic carriers," said Amber Dubey, director, aviation for global consultancy firm KPMG. "Our jet fuel prices are 50-60 percent higher than global average.“

"There is need to expedite big-ticket reforms like allowing foreign airlines to buy stake in domestic carriers and rationalisation of federal and state levies on jet fuel," said Dhiraj Mathur, executive director with PricewaterhouseCoopers

Projection of Traffics upto 2016-17

SWOT Analysis

Major policies taken in 11th Five Year Plan

Reduction of high Aviation Turbine Fuel(ATF) cost and review of its Tax structure

Multi Modal Connectivity by building expressways to facilitate advantage of air transportation by reducing the total travel time

foreign equity participation up to 49% and investment by non-resident Indians (NRIs) up to 100% in the domestic air transport services

Promotion of Regional Airlines by the way of liberal policy and provision of better infrastructure facilities

Development of MRO hub Review of RDG to bring them in line with developments Merger of AI and Indian Airlines to optimize fleet acquisition & to

leverage the asset base

Major policies taken in 11th Five Year Plan

100% FDI is permissible for existing airports; FIPB approval required for FDI beyond 74%

100% FDI under automatic route is permissible for greenfield airports

100% tax exemption for airport projects for a period of 10 years

projected outlay for the Eleventh Plan for MoCA is Rs 43560 crore at 2006–07 price

THANK YOU

AMAN KAUSHAL (11810009) AMIT MAHAJAN (11810012) PRIYA ADHIKARY (11810O62) SAUMYA VERMA (11810073)