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The domestic aviation industry continues to witness recovery with air passenger traffic logging around 60 per growth at 13.60 crore in FY23 annually, ICRA said on Wednesday.
Despite this, domestic air passenger traffic remained around 4 per cent below the pre-pandemic (FY20) volume of 14.15 crore, the credit rating agency said.
The Indian carriers had flown a total of 8.52 crore passengers on local routes in the year ended March 2022, as per ICRA.
Domestic passenger traffic stood at 1.30 crore in March this year, a growth of around 22 per cent from March 2022 volume of 1.06 crore, said Suprio Banerjee, Vice President, ICRA.
In FY23, the overall airlines' capacity deployment was higher by 38 per cent as compared to FY22, he said.
The airlines' capacity deployment last month was higher by 14 per cent year-on-year and around 7 per cent more than pre-COVID level of March 2019, ICRA said.
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The domestic passenger load factor of the airlines industry, according to ICRA is estimated at 89 per cent in March 2023, against 82 per cent in the year- ago period and 87 per cent in March 2019 (pre-COVID levels).
Despite a healthy recovery in passenger traffic, the domestic aviation industry continues to face challenges on account of elevated aviation turbine fuel prices and depreciation of the rupee against the US dollar, both of which have a major bearing on the airlines' cost structure, it added.
The airlines' efforts to ensure fare hikes proportionate to their input cost increase will be key to expanding their profitability margins, Banerjee added.
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