Domestic Airlines’ Shares Get A Boost As Cap On Ticket Prices Lifts



India’s domestic airlines get a boost as cap on ticket prices lifts

Shares of Indian domestic airlines rose on Thursday, a day after the civil aviation ministry said it will remove the restrictions on ticket prices it had imposed two years ago due to the coronavirus pandemic.

Domestic airlines IndiGo, SpiceJet Ltd, Air India, Go First and Vistara – a joint venture between the Tata Group and Singapore Airlines – can now price tickets freely.

Stocks of top airline IndiGo’s parent InterGlobe Aviation Ltd rose as much as 2.3 per cent to Rs 2,084.6 per share while smaller rival SpiceJet Ltd jumped as much as 7 per cent to Rs 47.9 a share.

The government had imposed a minimum and maximum band based on the flight’s duration to prevent ticket prices from spiking once restrictions on air travel eased.

Competition in the Indian aviation space is expected to heat up with the launch of Akasa Air and revival of Jet Airways.

The upcoming festival season is expected to boost demand for air travel, with passenger numbers already touching pre-COVID levels. But high fuel costs continue to be a dampener.

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