India Ratings downgrades GoAir’s debt, highlights liquidity concerns

India Ratings has downgraded GoAir’s debt and has flagged concerns about liquidity and deteriorating ioperating performance in FY21.

GoAir’ overall debt was up six per cent sequentially to Rs 1,891 crore in the June quarter and its unencumbered cash and bank balance nearly halved to Rs 72.5 crore during the same period, the rating agency has said in a report. The overall debt included borrowings from promoter group companies to support business operations.

Domestic flight operations resumed after two months suspension on May 25 and even now passenger occupancy is less than 60 per cent. GoAir began operations from June 1 and is said to be operating 15-18 aircraft daily. Loss of revenue during lockdown, muted passenger demand at present and high fixed cost remain a concern.