The Airports Authority of India (AAI) has cut its debt by around ₹2,100 crore on the back of recovery in air traffic and improved financials.

AAI had in FY21 borrowed from banks for capital expenditure and to meet its working capital requirements.

“The total long term borrowings of AAI as on March 31, 2023, was ₹4504.25 crore. Due to improved financials and cash inflows during FY23 and in FY24, AAI has repaid the term loan of ₹2,098.01 crore,” AAI said in an emailed response.

The authority posted profit before tax of ₹3,963 crore in FY23 as against ₹32.76 crore in the previous year. Total revenue rose 78 per cent on a year on year basis to ₹12,172.35 crore. In FY24, AAI’s revenue is estimated to grow to ₹14,054 crore due to strong growth momentum.

Airport services

AAI’s revenue mix comprises aeronautical and non aeronautical revenue sources as well as lease revenue from privately managed airports. Airport services which includes landing, parking charges, user development fees and air navigation services charges (ANS) are the biggest contributor to revenue. In FY19 the two components accounted for 58 per cent of AAI’s revenue of ₹14,132 crore.

Explaining the recovery, the authority said that ANS segment revenue in FY23 was mere 4 per cent lower than FY19. In FY 22 ANS segment revenue was 35 per cent lower than FY 19.

AAI is also taking steps to grow its non aeronautical revenue which rose 38 per cent on a year on year basis to ₹1,257 crore in FY23.

“AAI has redeemed its focus on exploitation of commercial opportunities at its  airports to enhance non-aeronautical revenue as well as passenger experience. AAI has recently reoriented its policy for granting licence to operate commercial facilities like F&B, retail, advertisement rights, duty free shops etc, at its airports. Aiming for enhanced ease of doing business, the AAI policy has been liberalised and made open to attract more and more entrepreneurs to operate such facilities at AAI operated airports,” the authority said.