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Credit rating agency ICRA on Wednesday said its outlook on the Indian aviation industry is stable on the back of the fast-paced recovery in domestic passenger traffic in FY2023 and nine month FY2024, and expectations of the trend continuing for the rest of FY2024.

In a research report on the sector, ICRA said the industry witnessed improved pricing power, reflected in the higher yields (over pre-Covid levels) and, thus, the revenue per available seat kilometre – cost per available seat kilometre (RASK-CASK) spread of the airlines.

The momentum in air passenger traffic witnessed in the current fiscal is expected to continue in FY2025, though further expansion in yields from the current levels may be limited.

For December, 2023, domestic air passenger traffic was estimated at about 138.1 lakh as against about 127.4 lakh in November 2023.

Domestic air passenger traffic in the nine month FY2024 (April–December 2023) was 1,145.4 lakh, a YoY growth of 16 per cent.

The airlines' capacity deployment in December 2023 was higher by about 3 per cent than December, 2022. Further, for 8M FY2024 (April–November 2023), the international passenger traffic for Indian carriers stood at about 189.5 lakh, a YoY growth of about 28 per cent.