Air traffic is expected to slump in fiscal year 2022 and fully recover only by the fourth quarter of fiscal 2023, because of the debilitating consequences of the second COVID-19 wave in India, Crisil said in a report.
But, the credit quality of airport operators will continue to be supported by strong business models and healthy liquidity covers amid low debt servicing needs this fiscal, it added.
With localised lockdowns, night curfews and other restrictions on movement of people, passenger traffic at airports has nosedived, with average daily domestic passenger traffic halving in May 2021 from February 2021, or to a mere 10% of pre-pandemic levels seen in May 2019 , the ratings agency said in the report.
“Second wave will push back revival of business travel and pick-up of international traffic, which account for over half of overall traffic,” said Manish Gupta, senior director, Crisil Ratings. “Given this backdrop, we now expect traffic volumes this fiscal to be 60% of fiscal 2020 levels, and recovery to pre-pandemic levels happening only by fourth quarter of fiscal 2023,” he added.
He said traffic volumes were expected to rebound once the present affliction curve starts to flatten.