Air India, now under the ownership of the Tata Group, has reported a significant increase in losses for the fiscal year 2023, totalling Rs 11,381 crore, marking an 18.6% surge compared to the previous fiscal.
However, amidst this financial setback, the airline is poised to embark on a path towards recovery, with projections indicating a narrowing of losses to approximately Rs 7,000 crore for the fiscal year 2024. The surge in losses in FY23 can be attributed to various factors, including write-offs and exceptional items, which amounted to Rs 9,591 crore in the preceding fiscal. Despite these challenges, Air India’s management remains optimistic about its financial prospects under the stewardship of the Tata Group.
According to industry sources, the airline experienced robust revenue growth during FY23, driven primarily by a healthy increase in passenger traffic. Additionally, strategic cost-saving measures such as automation initiatives have contributed to lowering operational expenses, further supporting the airline’s financial outlook. The fiscal year 2023 marked the first full financial year of Air India under the Tata Group’s ownership, following the acquisition in January 2022. With a renewed focus on operational efficiency and strategic planning, the airline aims to navigate the competitive aviation landscape more effectively in the upcoming fiscal year.
Air India’s CEO, Campbell Wilson, in a message to its employees last week, said, “Like all airlines, we have enjoyed good tailwinds with healthy demand and yields since Covid abated, and our topline performance has been very creditable across all revenue segments”. It is noteworthy that Tata Group’s acquisition of Air India involved a winning bid of Rs 18,000 crore, surpassing the reserve price of Rs 12,906 crore. As part of the acquisition deal, Tata Group absorbed a portion of the airline’s substantial debt, with Tata taking Rs 15,300 crore, while the remaining debt was transferred to AI Asset Holding, amounting to around Rs 46,000 crore. Looking ahead, Air India’s management is committed to implementing sustainable growth strategies and operational improvements to achieve long-term financial stability and profitability. As the airline continues its journey under Tata Group ownership, stakeholders will closely monitor its progress towards achieving its financial targets and reinforcing its position in the aviation industry.
