India’s largest domestic airline says it is building a war chest of more than $ 1 billion as it prepares for the third wave of Covid-19 infections, just as a nationwide outbreak begins to recede.
Ronojoy Dutan, CEO of IndiGo Airlines’s parent company InterGlobe Aviation, told the Financial Times he hoped the carrier business would return to pre-epidemic levels by the end of the year, but warned that other coronavirus wave in November may cause more disruptions.
The budget airline plans to raise 30 billion rubles ($ 410 million) through quality institutional allocation, which is used in India as a tool to raise equity to prepare for the worst-case scenario. IndiGo also plans to provide approximately $ 600 million in bank loans through aircraft lease sales.
“Doctors are telling us that there will be a third wave. “There are ‘if-buts’ in it, it will probably come in November, in December,” Dutta said.
“The board says, ‘Look, the environment is unstable.’ What if we go on a three-month break? Is the income zero? ” “We are building insurance for the disaster scenario,” he added.
Coronavirus cases in India have been steadily declining since peaking in mid-May, although the country set a one-day world record of more than 6,000 deaths this week, partly due to Delta version first discovered in the country.
However, about 100,000 cases are still reported daily, with many countries reporting such cases. Travel restrictions for travelers from India.
Before the start of the year, Prime Minister Narendra Modi reduced the threat The second wave claimed that the country had gained control of the virus.
As the second wave retreated, New Delhi received more cautious messages, warning of a third wave and expanding its vaccine engine.
InterGlobe, which has more than 50% market share, reported its fifth quarterly loss this month.
However, Dutta said the third wave is unlikely as harmful as the second“As long as: [India keeps] Vaccinate about 700,000 people daily. “It will be a very smooth wave,” he said.
He also expects IndiGo to benefit from Indians taking “revenge vacations” after months of confinement in their homes, adding that the company has added new routes to hotspots such as the Maldives.
“The epidemic has pushed India back for at least two or three years,” Dutta said. “It simply came to our notice then. “I strongly believe in the history of Indian growth.”
His cautious optimism contrasted with the recent rise in Indian stocks. record heights,
The World Bank cut its growth forecast for India from 10.1% to 8.3% this year, blaming a second wave of coronavirus.
“Recovery will begin in August, and for three months it has been virtually blocked in many states,” said Madan Sabnavis, chief economist at Care Ratings.
“Now it is almost supposed that the third wave will come, so there will be better preparation,” Sabnavis added. “The schedule is more or less regulated.”
Coronavirus business update
How does the coronavirus cause harm from markets, businesses, our daily lives, and our workplaces? Stay tuned for more information on our coronavirus newsletter.