IndiGo boards regional flight as profits dip, to acquire 50 smaller aircraft
IndiGo airlines, India’s largest passenger carrier by market share, has announced that it will acquire 50 smaller aircraft to be introduced on regional routes, a move that will act as a major boost to Prime Minister Narendra Modi’s UDAN scheme that aims at increased connectivity between India’s smaller towns at a price cap of Rs 2,500 per person per hour.
IndiGo on Tuesday said it would add about 50 turboprop aircraft for regional operations that would be run by a separate division. The announcement comes on the back of a good response to the PM’s scheme by both airlines as well as travelers. Alliance Air, a subsidiary of national carrier Air India, has already connected Delhi and Shimla, while Hyderabad-based TruJet has connected Hyderabad to Cuddapa and Nanded.
The announcement came on a day when InterGlobe Aviation Ltd, which runs India’s largest airline IndiGo, turned in a profit Rs 1,659 crore in the year ended March 31, 2017, down 16.5 per cent from Rs 1,986 crore the year before.
“In support of our Honourable Prime Minister Narendra Modi’s UDAN vision, we are embarking on a journey to build a nationwide regional network and connect cities that have not benefitted from the growth in Indian aviation,” IndiGo president Aditya Ghosh said in a statement.
IndiGo told BSE in a statement on Tuesday that it has signed an agreement with French aircraft maker Avions de Transport Regional GIE for the purchase of 50 ATR 72-600 aircraft with the flexibility to reduce the number of aircraft deliveries based on certain condition.
IndiGo plans to launch its turboprop operation by the end of 2017 and expects to induct up to 20 aircraft by December 2018.
“We are embarking on a journey to build a nation-wide regional network and connect cities that have not benefitted from the growth in India aviation,” IndiGo president Aditya Ghosh said in the statement.
IndiGo is likely to be a 177 aircraft airline by March. This number will 7 ATRs , he said.
IndoGo’s revenues rose to Rs 19,369.57 crore for year ended March 31 compared to Rs 16,655.03 crore the year before. It also announced a divided of Rs 34 per share. In the quarter ended March 31, Indigo registered a profit of Rs 440.30 crore, down 24.6 per cent from Rs 583.78 crore the year before.