Jet Airways sees rev up 15% over 5 years
Jet Airways expects to grow its domestic revenue by 15% and international revenue by up to 20% over the next five years, the chairman of India's largest airline said on Thursday.
January 13, 2011 / 21:26 IST
Jet Airways expects to grow its domestic revenue by 15% and international revenue by up to 20% over the next five years, the chairman of India's largest airline said on Thursday.
The airline expects higher demand driven by increasing affluence in Asia's third-largest economy, but has no plans of placing big aircraft orders, Naresh Goyal said at a conference organised by the Hotel Investment Forum India.A day after smaller rival IndiGo placed a USD 15.6 bn order to buy 180 planes from Airbus in the largest jet deal in commercial aviation history, Goyal said Jet is following a "relatively modest" aircraft acquisition strategy."Aircraft orders are not a problem... It's the easiest thing to do; but, can your balance sheet support it?" he asked.Many carriers are growing their fleet as demand booms in India, where the economy is growing at nearly 9%.Jet Airways has firmed up an order pipeline of 29 Boeing 737 planes for purchase, and another 10 Airbus 330s for lease.The deliveries for both types of aircrafts are expected to start in April 2012 and would continue over three years, Goyal said.Jet has placed another order for 10 Boeing 787 dreamliners, deliveries of which are seen starting in fiscal year 2015, he said.Low-cost carrier and smaller rival SpiceJet in November agreed to buy 30 Nextgen turboprop aircraft from Canada's Bombardier Inc for as much as $915 million. "We have to be very careful in adding capacity... We are not running after market share and have to ensure that the bottom-line is alright," he said.Jet has added capacity of 8 to 10% over the last three years, he said.While passenger traffic in India grew 19% through November last year, the country only has 400 commercial airplanes for a population of about 1.2 bn. By comparison, China has 2,600 planes.Jet Airways has no plans to hedge its jet fuel requirements and expects to improve its operating margins."As we grow, our cost of operations per unit (aircraft) will go down hence we hope to increase our profitability," Goyal said. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
