11.8.14

GoAir flies into the black

The Wadia Group-owned GoAir has flown into the black and is now firming up the launch of its international operations next May, apart from getting a foreign airline as FDI partner on board shortly. Speaking on the financials of the unlisted low-cost carrier (LCC), possibly for the first time, GoAir CEO Giorgio De Roni said that the airline had made a profit of Rs.100 crore in FY 2012-13. “The subsequent financial year 2013-14 was also profitable — all purely from operational side and nothing else (hinting that there was no sale and lease-back earning) — but the figure was lower due to the fall of the rupee and the sharp rise in aviation turbine or jet fuel (ATF) price. India has the highest domestic ATF price globally . The first quarter of this fiscal was profitable and FY 2014-15 is set to be profitable,“ De Roni, the man behind the LCC's quiet turnaround, said.
While the LCC is not planning an IPO like IndiGo, it is talking to several foreign airlines for FDI. “(Those talks) are not for cash but for best practices, industry knowledge and network. We are looking for a long-term strategic partner,“ the CEO said. The 2005 founded GoAir is going to get its 20th aircraft in October and fulfill both the requirements of the five years of operations and 20 aircraft rule to fly abroad. “The launch will be at the start of the next fiscal, possibly May 2015. We are looking at flights with a maximum flying time of three hours and 15 minutes. So, destinations like Singapore are not planned. We are looking mainly at the Gulf, apart from some other destinations,“ De Roni said.
The LCC, however, remains bullish on domestic operations where it has been witnessing 20% increase in passenger carriage and an even higher rise in revenue with corporates and SMEs taking fancy to its Go business product. “We are going to deploy 13% of our capacity on international routes. We believe the domestic market will continue to grow and we want to play a role in this,“ De Roni said.

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