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2d ago

ICRA Doubles FY26 Loss Forecast for Indian Airlines to Rs 17,000–18,000 Crore

The agency trims traffic expectations following IndiGo’s December cancellations, with rupee weakness lifting costs.

Domestic Air Traffic May Be 0-3% In FY26, Not 4-6% Projected Earlier: ICRA Report | Image: ANI/Representative
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Overview

  • ICRA now expects domestic passenger growth of 0–3% in FY26, down from 4–6%, and international growth of 7–9%, cut from 13–15%.
  • The revised loss estimate compares with an earlier forecast of Rs 9,500–10,500 crore, reflecting softer demand and higher dollar-linked expenses.
  • IndiGo cancelled about 4,500 flights between December 3–8, and the DGCA granted it temporary relief from new duty-time norms until February 10, 2026.
  • Cost pressures intensified as the rupee’s depreciation led to foreign-exchange losses and ATF prices rose 8.5% year-on-year and 5.3% month-on-month in December.
  • Capacity remains constrained by Pratt & Whitney engine issues, with supply-chain stress affecting an estimated 15–17% of the industry fleet and prompting costly wet leases.