Air passengers in India likely to decline in June, after tragic Air India incident: Report
Post recovery of air passengers in May 2025 after India-Pak ceasefire, a report by ICICI Securities says the aviation ministry passenger travel data number indicates further decline in June.
ANI
Jun 20, 2025 13:18 IST
New Delhi [India], June 20 (ANI): Post recovery of Air passengers in May 2025 after the cessation of India-Pak hostilities, a report by ICICI Securities says the aviation ministry passenger travel data number indicates further decline in June.
"As per daily data reported by MoCA, average daily passengers had seen a decline in May'25 following the geopolitical conflict. However, post-declaration of ceasefire, domestic air travel had returned to normalcy. Average daily passengers again declined post the unfortunate Air India accident on 12 Jun'25," the ICICI Securities report noted.
According to the report the average daily passengers in April this year was at 490K, however, a decline was witnessed in May 2025 due to India-Pakistan geopolitical conflict. However, Average daily pax returned to 490l before 12 Jun'25 (before Air India incident), post which it has declined to 460k again.
On the international travel side, international air travel has experienced a setback since May 2025, weighed down by geopolitical issues like the India-Pakistan conflict.
Recently, Air India has reduced its international services on wide-body aircraft by 15 per cent for the next few weeks. The decision comes after the tragic loss of 241 lives on board Air India-171 flight, which crashed in Ahmedabad.
"Air India cancelled 83 wide-body operations between 12 and 17 Jun'25. As per daily data reported by MoCA, average daily international passengers have declined from 118k in Apr'25 to 113k in May'25 and 102k in Jun'25," adds the report.
However, ICICI securities believes that the weakness in Aviation Turbine Fuel (ATF) price could offset the weakness seen in passenger demand in May/Jun'25.
ATF prices have experienced weakness as average ATF prices declined 8.2 per cent on a QoQ basis in Q1FY26 to Rs 86k/KL vs. Rs 94k/KL in Q4FY25.
But now, because of the recent geopolitical crisis, crude oil prices are going up, which can change the dynamics for the airline sector.
"On the backdrop of the current geopolitical scenario, crude oil prices have increased approx. 20 per cent since the start of Jun'25 to USD 77/bbl., as on19 Jun'25. This surge in prices may pose a threat to earnings in the seasonally weak Q2 ahead," the report said. (ANI)
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