Domestic Aviation Market – India (Part I)

July 2011
Executive Summary
Indian aviation market ranks 9th among the aviation markets across the globe
Global aviation industry is poised to grow at a healthy 5.6% CAGR over the next 15
Market years
Indian
I di airline
i li industry
i d t hash grown by b ~400% in i the
th last
l t six
i and
d a half
h lf years
Drivers: Challenges:
Increasing spending power  Delays and cancellations
Lowering of fares Volatility in aviation turbine fuel
Drivers & Favorable economic condition prices
Challenges Strict FDI regulations
Growth in tourism
Investment in aircraft High rate of service tax
Demand‐Supply gap and low penetration
Airlines expand international operations
Trends
Airlines offering holiday packages
Value added services are offered by the airlines

Aviation market is highly organized with the presence of domestic and international
Competition
p players
Major players include Air India, Jet Airways, Kingfisher and Indigo

DOMESTIC AVIATION MARKET IN INDIA 2011.PPT 2

•Introduction
•Market Overview
•Passenger
g Traffic – byy
geographical zones
•Drivers & Challenges
g
•Trends
•Competition

DOMESTIC AVIATION MARKET IN INDIA 2011.PPT 3

 Aviation Industry – Market Structure

Aviation Industry

Airlines Support Services Aerospace

Design and
Passenger Cargo MRO
Manufacture

Ground
Training Catering
Handling

Focus Area of Report

Source: IBEF “ “Indian air cargo industry spreads wings “, Mar 2008; Business Line “Foreign players in air freight”, Sep 2008; IATA; World Air Cargo Study

DOMESTIC AVIATION MARKET IN INDIA 2011.PPT 4

•Introduction
•Market Overview
•Passenger
g Traffic – byy
geographical zones
•Drivers & Challenges
g
•Trends
•Competition

DOMESTIC AVIATION MARKET IN INDIA 2011.PPT 5

 Indian aviation industry is witnessing steady growth and is
expected to continue to grow
Overview Market Size: Passenger Traffic
• Indian aviation market ranks 9th among the aviation mn
markets across the globe
600 540
• Global aviation industry is poised to grow at a
healthy 5.6% CAGR over the next 15 years 400
• Civil airline industry has grown by ~400% since 2004 +15%
200 123 142
• Domestic air traffic rose from 85 mn in 2009 to 126
mn in
i 2011 and d international
i t ti l air
i traffic
t ffi grew from
f 35 0
mn in 2009 to 46 mn in 2011 2010 2011 2025e
Note: All figures are for the financial year
Market Segmentation (2010) Service‐wise Segmentation (2011)
Full Service Carriers (FSC)
Domestic
Low Cost Carriers (LCC)
26% International
34%

66%
74%

Source: Business Line “Growth in aviation industry promising”, Apr 2011; “Civil aviation industry grew by 400% in six yrs: Patel” Hindustan Times, Dec 2010;
Commodityonline “India aviation industry needs $30 bn for full throttle growth”, May 2011

DOMESTIC AVIATION MARKET IN INDIA 2011.PPT 6

•Introduction
•Market Overview
•Passenger
g Traffic – byy
geographical zones
•Drivers & Challenges
g
•Trends
•Competition

DOMESTIC AVIATION MARKET IN INDIA 2011.PPT 7

 Non‐metro cities Ahmedabad, Srinagar show strong
potential while Kolkata leads in the metro city category
High Growth Areas – Airport Traffic (in mn)
City 2006 2007 2008 2009 2010 Growth

M
Metro Ci
Cities
i
Among the
Kolkata 4 6 7.4 7 9.6 19%
metro cities,
Kolkata leads
Delhi 16 20 24 23 30 13% in terms of
growth
Chennai 6.7 5.7 10.6 9.8 12 12% between 2006
and 2010
Mumbai 17.8 22 26 23 29 10%

N M t Citi
Non‐Metro Cities
In the North,
North Srinagar
registered a
Srinagar 0.47 0.69 0.78 0.73 1 16% high double
di i growth
digit h
Amritsar 0.46 0.56 0.63 0.57 0.76 11% showing strong
potential
Northwest

Ahmedabad 17
1.7 24
2.4 3 27
2.7 4 19%
Note: Figures include domestic and international data
Source: Airport Authority of India; Directorate General of Civil Aviation

DOMESTIC AVIATION MARKET IN INDIA 2011.PPT 8

 Airport traffic in Guwahati increased at the highest rate
closely followed by Cochin and Calicut
High Growth Areas – Airport Traffic (in mn)
City 2006 2007 2008 2009 2010 Growth
Non Metro Cities
Non‐Metro Guwahati
registered the
East highest growth
in airport
Guwahati 0.72 1 1.3 1.3 1.9 21% traffic among
the non‐metro
West cities in east,
west and south
Goa 1.6 2.2 2.5 2.2 3.07 14%

South
IIn th
the SSouth,
th
Cochin 1.8 2.5 3.3 3.3 4.3 19% Cochin leads
with the
maximum
Calicut 0.9 1.1 1.3 1.7 2.02 18% growth closely
followed by
Bangalore 5.6 8.1 10 8.7 11.5 15% Calicut

Hyderabad 3.9 5.7 6.9 6.1 7.5 14%

Trivandrum 1 32
1.32 0 56
0.56 0 63
0.63 0 57
0.57 0 76
0.76 11%
Note: Figures include domestic and international data
Source: Airport Authority of India; Directorate General of Civil Aviation

DOMESTIC AVIATION MARKET IN INDIA 2011.PPT 9

 Thank you for the attention
The Domestic Aviation Market – India report is a part of Research on India’s Aviation Industry
Series.
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DOMESTIC AVIATION MARKET IN INDIA 2011.PPT 10