Bleeding airlines have started infecting airport operators, with the Delhi international airport staring at the prospect of downing shutters in two months over mounting dues from Air India and Kingfisher Airlines. Sidharath Kapur, chief financial officer (CFO) of Delhi International Airport Ltd (DIAL) told reporters on Tuesday: ?If payments are not made, there may be a situation after two months that we may not be able to operate and pay our employees.?
Kingfisher and Air India jointly owe about R525 crore to DIAL, promoted by airport developer GMR. The Delhi airport, which handled 35.9 million passengers in 2011-12, is India?s busiest airport. Kapur said the company is losing R40 crore every month.
DIAL has asked Air India to pay R300 crore immediately out of its dues of R450 crore. Kingfisher owes the rest R75 crore. ?Kingfisher has started paying R50 lakh per day. We have asked them to raise it by another R20 lakh,? he said. Kingfisher?s dues are not climbing since the airline has reduced operations, but the case of the public sector airline is different.
The DIAL management led by GMR chairman GM Rao met reporters on Tuesday to release an NCAER report titled ?Economic impact study of Delhi airport?. The study claims the airport has contributed about 0.5% to the GDP of the country in 2010-11. Rao, however, steered clear of mentioning the financial crisis at Delhi airport, focusing instead on the findings of the study.
DIAL?s aeronautical revenues rose from Rs 361 crore in 2008-09 to Rs 459.7 crore in 2010-11 on total revenues of Rs 1,261 crore, Kapur said. But the company is still expected to incur a loss of Rs 450 crore. The airport developer expects to end 2011-12 with a cumulative loss of about Rs 950 crore. Higher provisioning for depreciation and capitalisation costs have also added to losses, he said.
According to Kapur, the losses have ballooned so much that banks have turned chary of extending loans to meet working capital needs. ?We have already borrowed Rs 5,300 crore from foreign and domestic banks. No bank will give us more money considering our losses,? he said.
DIAL has also been pitching for an over 600% hike in aeronautical charges with the Airport Economic Regulatory Authority. Though a decision in this regard is expected by next week, according to industry officials, the hike may not be more than 334%. And that will benefit the company only from the current fiscal.
?We hope the regulator accepts our proposal. A 600% hike would translate into an average additional cost of Rs 350-450 per passenger,? another DIAL official said.