Spicejet eyes financial breakeven this year

Low cost carrier Spicejet hopes to achieve financial break-even this fiscal subject to costs remaining constant. The airline expects to post a turnover of Rs 1,100 crore in 2006-07 against Rs 481 crore last year, said Spicejet vice-president (sales & planning) Sanjay Kumar. "We achieved operational breakeven last year. We hope to achieve financial breakeven this fiscal, provided variable costs like fuel prices remain constant till the conclusion of the fiscal," said Mr Kumar. Prices of aviation turbine fuel remained stable until December 2006, but witnessed a hike this month. If it continues at the present level, achieving breakeven should be possible, he added. Spicejet's projected turnover of Rs 1,100 crore by March 2007 will be on account of addition of four aircraft to its fleet.

"Our fleet size will go up to 17 aircraft by December 2007 and by the end of 2008, we hope to have a fleet of 26 aircraft", Mr Kumar added. Spicejet, which has carried 3 million passengers since May 2005, enjoys a load factor of 80%. The airline commands an overall market share of 9% in India and expects to step it up to 15% with its expanded fleet. The size of the Indian aviation industry is about Rs 20,000 crore, in terms of revenue of all airlines. The industry has seen a huge growth in passenger traffic, which increased from 13 million in 2003 to about 32 million passengers in 2006, according to Mr Kumar.

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