ICRA expects 18-20% growth for airport operators in FY26 on higher traffic

Indian airport operators are projected to see an 18-20% YoY growth in FY26, driven by sustained improvements in passenger traffic, tariff hikes, and increased non-aeronautical revenues, according to ratings agency ICRA. The overall passenger traffic, including domestic and international, is estimated to grow at a healthy 7-9% YoY, reaching 440-450 million in FY26. FY25 saw an 11% expansion in international traffic and a 9% rise in domestic traffic, with the overall passenger traffic estimated at 412-415 million. ICRA's estimates are based on a sample set of airports, including those managed by the Airports Authority of India (AAI) and major international airports operating under the public-private partnership (PPP) model. The sector is expected to witness substantial capital expenditure due to capacity bottlenecks at some airports.

Investments of over Rs. 1,00,000 crore (US$ 11.61 billion) are expected over the next four to five years, including greenfield airports like Jewar (Noida), Navi Mumbai, Bhogapuram (AP), and Parandur (Chennai). Brownfield expansions and upgrades are also planned for Bangalore, Hyderabad, Cochin, Mumbai, and Nagpur airports. International traffic continues to outpace domestic traffic growth, driven by healthy tourism activity and improved connectivity to new destinations. The growth momentum is expected to be sustained in FY26, with YoY growth of 7-11% in international traffic and 6-8% in domestic traffic. The revenues of ICRA's sample set companies are likely to grow by a robust 18-20% YoY in FY26, supported by healthy profitability margins and comfortable liquidity.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.