India's Airport Passenger Traffic Set to Reach New Heights of 440-450 Million by FY26
Click to start listening
Synopsis
India's airport passenger traffic is set for a remarkable rise, reaching 440-450 million in FY26, with a projected annual growth of 7-9%. This growth is supported by increased tariffs, improved connectivity, and a boost in international travel.
Key Takeaways
- Projected passenger traffic of 440-450 million in FY26.
- Annual growth rate of 7-9 percent.
- Revenue expected to rise by 18-20 percent.
- Strong metrics with interest cover above 5 times.
- International traffic growth outpacing domestic.
New Delhi, April 10 (NationPress) The total airport passenger traffic in India is anticipated to experience robust annual growth of approximately 7-9 percent in FY26, aiming for a record 440-450 million, according to a report released on Thursday.
Revenue is also expected to increase by around 18-20 percent year-on-year in FY26, driven by the consistent rise in passenger numbers, tariff hikes at Delhi, Bengaluru, and Hyderabad airports, as well as a boost in non-aeronautical revenues.
The financial metrics of the sector are projected to remain strong, with an interest cover exceeding 5 times and a debt service coverage ratio (DSCR) above 3.5 times in FY26, as per the findings of credit rating agency ICRA.
The previous fiscal year, FY25, marked an 11 percent increase in international traffic and a 9 percent rise in domestic traffic.
The ongoing healthy growth trend has been fueled by an ongoing rise in international travel, improved connections to new destinations, a continuous increase in leisure and business travel domestically, and enhanced air connectivity to tier II cities and major tourist spots.
“International traffic continues to surpass the growth of domestic traffic, bolstered by strong international tourism activities and enhanced connections to new locations. This growth trend is likely to persist into FY2026, with expected year-on-year growth rates of 7-11 percent for international traffic and 6-8 percent for domestic traffic,” stated Vinay Kumar G, Sector Head of Corporate Ratings at ICRA.
The significant increase in international traffic will positively impact the airport sector, as it tends to be more profitable than domestic traffic.
Regarding the performance of airport operators, Kumar noted that despite higher interest expenses and debt repayment associated with the commercialization of capital expenditure programs at key airports, profitability margins are expected to remain healthy in FY26, ensuring comfortable debt coverage metrics.
The credit standing of airport operators is projected to stay stable, backed by solid accruals and adequate liquidity, as outlined in the report.
