Krishnan Balakrishnan, the Chief Financial Officer at GoAir, said on Monday that the rising cost of jet fuel may force the airline to pass on the burden to passengers “at some point”.
Speaking to CNBC-TV18, Balakrishnan said that said that GoAir had been profitable for five years in a row and had managed to finish in the green even when air turbine fuel had been USD 120 a barrel.
But he admitted that even at the current $57 a barrel, fuel costs were affecting everyone’s bottomlines. “Every rupee counts,” he said, adding that he did not expect ATF prices to rise beyond $60 per barrel in the next two to three years.
Shares of most aviation companies fell last Wednesday after Indian Oil Corp. Ltd increased aviation turbine fuel prices by 2.9 percent.Balakrishnan said that volatile fuel prices meant the company had to work with razor-thin margins, similar to players like Jet Airways and IndiGo, which saw their net profits dip by 70 percent and 25 percent respectively for the quarter ended December.
He said that GoAir currently has a fleet 23 aircraft and a 24th would be ready for take-off in the next couple of weeks. The airlines has a 8.4 percent share in the domestic market, marginally down from last year, which Balakrishnan said was because competitors had expanded their respective fleets.
He said that formal work on an Initial Public Offering was underway and that the company hoped to be listed sometime in 2018.
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