March is turning out to be a tumultuous month for carriers in India. In March last year, the government started the divestment process for the state-owned Air India and this March, Naresh Goyal was forced to step down as Chairman of Jet Airways.
The reasons for these two happenings are quite similar. Air India had been posting losses since its merger with Indian Airlines in 2007 and the carrier is estimated to have a debt burden of over Rs. 55,000 crore — a situation that warranted some action.
The situation is no better for Jet. The March 2018 quarter saw Jet post a huge loss of Rs. 1,036 crore compared to a profit of Rs. 602 crore in the year-ago period. This loss was a reversal from the profits in the earlier three quarters (June, September and December 2017) and pushed the airline’s full-year FY2018 bottom line deep into the red ( Rs. 767 crore).
