Sector Update | 22 January 2018
Aviation
Aviation
Domestic passenger growth
(YoY; %)
20.6
15.7 16.5
12.5
Domestic air passengers increase 17.8% in December
Domestic PLF at a record high of 89.5% led by strong festive demand
16.9 17.8
Domestic air passengers in India grew 17.8% YoY to 11.2m in Dec-17 and 18.4% YoY in
3QFY18 (v/s +15% YoY in 2QFY18). Passenger growth has been in double-digits for the
last 41 months.
Domestic ASK grew 16.5% YoY in Dec-17 and 14.2% YoY in 3QFY18 (v/s +14% YoY in
2QFY18). RPK rose 17.5% YoY in Dec-17 and 18.3% YoY in 3QFY18 (v/s +15% YoY in
2QFY18).
IndiGo’s domestic ASK/RPK grew at 12.6/12% in Dec-17, after recording muted growth
th
over the last six months due to engine issues. IndiGo received seven NEOs post 17
November 2017, which accelerated capacity addition in Dec-17.
Domestic industry load factor stood at a record high of 89.5% in Dec-17 and 87.8% in
3QFY18 (v/s 83.7% in 2QFY18). IndiGo’s load factor also increased to 90.8% in Dec-17
and 89.6% in 3QFY18 (v/s 84.1% in 2QFY18).
Domestic air passengers up 17.8% YoY to 11.2m in December
Industry load factor (%)
89.2 89.5
83.2 83.5
84.5 84.8
India's domestic air passengers grew 17.8% YoY to 11.2m in December 2017.
Passenger growth has been in double-digits for the last 41 months.
IndiGo’s passengers grew 15% YoY in Dec-17 and 12% YoY in 3QFY18 (v/s 10%
YoY in 2QFY18).
GoAir’s passengers rose 38.4% YoY in Dec-17 and 34% in 3QFY18 (v/s 12% YoY in
2QFY18).
SpiceJet’s domestic passenger volumes grew 23% YoY in Dec-17 and 18% in
3QFY18 (v/s 31% YoY in 2QFY18).
Passenger volume growth for the other airlines was as follows: Jet Airways:
+11% YoY (+16% YoY in 3QFY18) and Air India: +11% YoY (+19% YoY in 3QFY18).
IndiGo’s passenger market share stood at 39.5% in Dec-17 and 39.6% in 3QFY18
(v/s 38.4% in 2QFY18).
SpiceJet’s market share stood at 12.7% in Dec-17 and 12.8% in 3QFY18 (v/s 14%
in 2QFY18).
GoAir’s market share stood at 9.6% in Dec-17 and 9.2% in 3QFY18 (v/s 8.1% in
2QFY18); it seems to have stabilized in the 8-9% range. Jet Airways’ market
share remained below 20% for the 21
st
consecutive month at 16.7%. Prior to
that, it had a market share of above 20% since July 2014.
Air India’s market share stood at 13% in Dec-17 (v/s 13.3% in 2QFY18).
IndiGo’s domestic ASK increased 12.6% YoY in Dec-17 and 7.2% YoY in 3QFY18
(v/s 6% YoY in 2QFY18); its domestic ASK share was the highest at 40.2%.
SpiceJet’s domestic ASK grew 15.7% YoY in Dec-17 and 17.5% YoY in 3QFY18 (v/s
31.4% YoY in 2QFY18).
Domestic ASK grew 38% YoY in Dec-17 and 32.2% YoY in 3QFY18 (v/s 20% YoY in
2QFY18) for GoAir, and 10.5% YoY in Dec-17 and 13.1% YoY in 3QFY18 (v/s 14%
YoY bin 2QFY18) for Jet Airways.
IndiGo’s PAX market share stays highest; Go Air’s share inches up
Passenger market share (%)
Nov-17
IndiGo
Jet
AI
SpiceJet
GoAir
Others
17.4
16.7
13.5
13.0
12.6
12.7
8.9
9.6
8.1
8.4
Dec-17
39.5
39.5
Domestic ASK grows 16.5% YoY in Dec-17 (+14.2% YoY in 3QFY18)
Swarnendu Bhushan – Research Analyst
(Swarnendu.Bhushan@MotilalOswal.com); +91 22 6129 1529
Abhinil Dahiwale – Research Analyst
(Abhinil.Dahiwale@MotilalOswal.com); +91 22 3980 4309
22 January
1
Investors
2018
advised to refer through important disclosures made at the last page of the Research Report.
are
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.

Aviation
Domestic RPKs rise 17.5% YoY in Dec-17 (+18.3% YoY in 3QFY18)
IndiGo’s RPK grew 11.8% YoY in Dec-17 and 9.1% YoY in 3QFY18 (v/s 8% YoY in
2QFY18), with the highest market share of 41% in December.
SpiceJet’s domestic RPK grew 18% YoY in Dec-17 and 20% YoY in 3QFY18 (v/s
33.5% YoY in 2QFY18), with a market share of 12.2% in December.
GoAir’s domestic RPK grew 39.8% YoY in Dec-17 and 35.8% in 3QFY18 (v/s 15.9%
YoY in 2QFY18), with a market share of 9.6% in December.
Jet Airway’s RPK growth stood at 14% YoY, followed by Air India (+10% YoY) in
December.
Domestic industry load factor at 89.5% in Dec-17 (87.8% in 3QFY18
SpiceJet’s load factor stood at 95.6% in Dec-17 and 94.9% in 3QFY18 (v/s 94.3%
in 2QFY18); has had 90%+ load factor for the last 32 months.
IndiGo’s load factor stood at 90.8% in Dec-17 and 89.6% in 3QFY18 (v/s 84.2% in
2QFY18).
GoAir’s load factor stood at 92% in Dec-17 and 89.9% in 3QFY18 (v/s 85.5% in
2QFY18).
Jet reported load factor at 88.6% in Dec-17 and 85.5% in 3QFY18 (v/s 80.6%
2QFY18).
Air India reported load factor at 81.5% in Dec-17 and 80.4% in 3QFY18 (v/s
76.5% in 2QFY18).
Exhibit 1:
Domestic passengers grew 17.8% YoY to 11.2m in December 2017
Total Domestic Passengers (millions)
Passenger growth has
been in double-digits
over the last 41 months
Source: DGCA, MOSL
Exhibit 2:
Double-digit passenger growth since August 2014
Domestic passenger growth (YoY %)
Domestic passenger volumes
grew 17.8% YoY in December
2017
Source: DGCA, MOSL
22 January 2018
2

Aviation
Exhibit 3:
Airline-wise domestic passenger growth (YoY; %)
Passenger gr.
YoY (%)
80
Total
Air India
IndiGo
SpiceJet
Jet Airways
GoAir
IndiGo’s passenger volumes
grew 15.1% YoY in December
2017
50
20
-10
-40
Source: DGCA, MOSL
Exhibit 4:
Airline-wise domestic passenger break-up (in millions) – total domestic passenger volumes at 11.2m in Dec 2017
Domestic Passengers (m)
IndiGo
Jet Airways
Air India
SpiceJet
GoAir
Others
Total
0.6
0.6 0.8
0.7
1.0 1.1
1.5 1.5
3.8 3.8 3.8 3.4 3.6 3.8 4.2 3.8 3.7 3.7 3.7 4.1 4.1 4.4
2.8 2.5 2.4 2.4 2.4 2.6 2.6 2.7 2.7 2.8 3.0 3.1 3.3 3.0 3.4 3.3 3.3 3.7
2.5
0.6
0.8
1.0
1.4
0.6
0.8
1.1
1.5
0.5
0.8
1.1
1.5
0.6
0.8
1.0
1.5
0.6
0.9
1.1
1.5
0.6
1.0
1.2
1.6
0.6 0.6
1.0 1.0
1.3 1.2
1.6 1.6
0.7
0.7 0.7 0.7 0.7
0.6 0.7 0.7 1.1 1.0 1.0 1.1 1.0
1.0 1.0 1.0 1.3
1.3 1.2 1.2 1.2
1.1 1.1 1.2
1.6 1.5 1.6 1.6 1.5
1.6 1.6 1.5
0.7
1.1
1.1
1.5
0.8
0.7
1.1 1.2
1.1 1.3
1.5 1.7
0.9
0.8
0.8 0.8
0.8 0.7 1.3 0.8 0.7
0.7
1.2
1.3 1.4 1.4 1.3
1.1 1.2 1.2 1.3
1.3
1.2 1.3 1.3 1.3
1.1 1.2 1.1
1.7 1.6 1.6 1.6 1.8 1.7 1.7 1.8 1.7
1.1
0.9 0.9
1.4
1.4 1.3
1.4 1.4 1.5
1.8 1.8 1.9
Exhibit 5:
Airline-wise domestic passenger market share (in %) – IndiGo remains market leader, with 40% share
Domestic market share (%)
3 4 4
9 9 9
11 12 12
16 16 15
IndiGo
Jet Airways
Air India
6 7 7
8 8 8
13 13 13
14 13 13
SpiceJet
7 7 7
8 8 9
13 13 13
14 14 13
GoAir
7 7 7
9 8 9
13 13 13
13 13 13
Others
8 8 8
8 9 9
14 13 13
13 13 13
8
10
13
13
5 5 5 5 5 6 6
8 8 9 8 8 8 8
12 12 12 13 13 13 13
16 16 16 15 16 16 16
6 6 6 6 5 6 6
8 8 9 8 8 8 8
13 13 13 13 13 12 13
15 14 15 15 16 15 14
8 8 8
8 8 8
13 14 14
13 13 13
23 21 21 23 23 22 21 21 21 21 21 20 19 19 19 19 19 19 17 17 18 18 18 18 18 18 17 18 18 18 17 17 17
38 39 39 36 35 37 37 36 36 36 37 39 39 39 38 40 40 40 43 42 40 40 40 40 42 41 40 39 38 38 40 40 40
22 January 2018
3

Aviation
Exhibit 6:
Monthly domestic ASKs (billions) – up 12.6% YoY in December 2017
Domestic ASK (b)
IndiGo
Jet Airways
Air India
SpiceJet
GoAir
Others
Total Domestic ASK
0.6
0.7
1.3
1.6
0.7
0.8
1.3
1.6
0.7
0.7 0.7 0.7 0.7 0.6
0.7 0.7 0.7 0.7
0.8 1.0 0.9 1.0 0.9 1.0
0.7 0.8 0.8 0.8
1.4 1.3 1.4
1.3 1.3 1.3 1.3 1.3 1.3 1.4
1.7
1.6 1.6 1.6 1.6 1.7 1.7 1.7 1.7 1.6
0.8
0.7 0.7
0.7
1.0
0.7
0.9 1.0
0.9
1.0
1.5 1.4 1.4 1.4
1.4
1.7 1.8 1.7 1.7 1.7
0.9 0.8
0.8 0.8 0.8 0.8
0.7
1.0 1.1 1.2 1.2
0.8
1.2 1.1
1.0
1.1 1.4
1.4
1.4 1.4 1.4 1.5 1.5 1.3
1.8 1.8
1.6 1.7 1.7 1.8 1.8 1.6
0.9 0.9 0.9 0.9 0.9
1.2 1.2 1.3 1.3 1.2
1.5 1.5 1.6 1.5 1.5
1.9 1.9 1.9 1.9 1.9
1.0 1.0 1.1
1.3 1.2 1.4
1.6 1.5 1.6
2.0 1.9 1.9
4.0 4.1 4.0 4.0 4.4 4.3 4.3 4.3 3.9 4.4 4.3 4.5 4.3 4.3 4.3 4.2 4.6 4.5 4.8
3.0 3.1 3.0 3.1 3.2 3.1 3.3 3.2 3.2 3.3 3.3 3.6 3.7 3.9
Source: DGCA, MOSL
Exhibit 7:
Monthly market share by domestic ASKs (%) – IndiGo’s ASK market share stood at 40%
Domestic ASK market share (%)
IndiGo
Jet Airways
7 7 7 7 8
8 8 8 8 8
10 10 10 10 10
15 15 15 15 14
Air India
8 7 8
8 8 8
11 11 12
14 15 15
SpiceJet
GoAir
Others
9 9
9 9
11 11
14 14
5
6
6
6 7
9 9 9 8 8 9 8 8 8 8 8 8 8 8
9 10 10 10 10 10 10 12 11 11 11 11 11 11
17 17 17 17 17 16 16 16 16 16 16 15 15 15
7 7 8 8 8
8 8 8 8 8
12 11 11 11 11
14 14 14 14 14
8 9 9 9
8 8 8 9
12 12 12 11
15 14 14 14
21 21 21 20 20 20 20 20 20 20 20 19 19 19 18 18 18 18 17 17 17 17 17 17 17 18 18 18 18 18 17 17 16
40 40 39 40 39 40 39 38 38 39 40 40 41 41 42 43 42 43 43 43 42 41 41 42 42 42 41 40 40 39 40 40 40
Source: DGCA, MOSL
Exhibit 8:
Monthly domestic RPKs (billions) – YoY growth was highest for GoAir (40%), followed by SpiceJet (18%), Jet
Airways (14%), IndiGO (12%) and Air India (10%)
Domestic RPK (b)
IndiGo
Jet Airways
Air India
SpiceJet
GoAir
Others
Total
0.6
0.6
1.0
1.3
0.6
0.7
1.1
1.3
3.8 3.9 3.9 3.4 3.6 3.7 4.1 3.8 3.6 3.6 3.6 4.1 4.0 4.4
2.8 2.6 2.5 2.4 2.5 2.7 2.7 2.8 2.8 2.8 3.1 3.1 3.4 3.1 3.4 3.3 3.3 3.7
2.5
0.5
0.7
0.9
1.2
0.5
0.7
1.0
1.3
0.5
0.7
1.1
1.3
0.5
0.7
1.0
1.2
0.6
0.8
1.0
1.3
0.6
0.9
1.1
1.4
0.6
0.9
1.2
1.4
0.7
0.7 0.6
0.6 0.6 0.6 0.6 0.9 0.6 0.9 0.9
0.9 0.9 0.9 0.9 1.2 0.9 1.2
1.1
1.1
1.1 1.0 1.0 1.1
1.5 1.3 1.4 1.4
1.4 1.4 1.4 1.3
0.6
0.9
1.1
1.3
0.7
1.0
1.0
1.3
0.7
0.7 1.1
1.0
1.0 1.2
1.4 1.5
0.8
0.7
0.7 1.1 0.8 0.7 0.7
1.1 0.7 0.7 1.1
1.1 1.2 1.2
1.0 1.1
1.2
1.2
1.2 1.2 1.2
1.1 1.1 1.1 1.6
1.5
1.5 1.5 1.6
1.4 1.4 1.5
1.0
0.9 0.9
0.8 1.2 1.2 1.3
1.2
1.2 1.3 1.3
1.2
1.6 1.7 1.7
1.5
22 January 2018
4

Aviation
Exhibit 9:
Monthly domestic RPK market share (%) – IndiGo had the highest RPK market share of 41% in December 2017
Domestic RPK market share (%)
IndiGo
Jet Airways
Air India
SpiceJet
GoAir
Others
9 9 9
9 9 10
12 12 12
13 13 13
5
5
5
6
9 9 9 8 8 9 8 8 8 8 8 8 9
10 11 11 11 11 11 12 13 12 12 12 12 12
16 16 15 16 17 16 15
16 16 15 15 14 14
6 7 7 6 6 7 7 7 7 7
8 8 8 8 8 8 8 8 8 8
11 12 11 12 12 12 12 12 12 13
15 15 14 14 14 12 12 13 13 13
7 8 8 8 8 9 9
9 8 8 8 8 8 9
12 12 12 13 13 13 13
13 12 13 13 13 13 13
21 20 19 21 21 20 19 19 19 20 19 18 18 18 18 18 18 17 16 16 17 17 17 17 17 17 17 17 17 17 16 17 16
41 42 41 39 38 40 40 39 39 39 40 41 42 41 41 42 42 42 45 45 43 42 42 42 43 43 41 40 40 40 41 41 41
Source: DGCA, MOSL
Exhibit 10:
Monthly domestic load factor (%)
Industry load factor at
record peak of 89.5% in
December 2017 (v/s 89.2 in
November 2017).
SpiceJet’s PLF at 95.6%;
consistently above 90% for
nd
the 32 straight month.
IndiGo
SpiceJet
90
80
70
Jet Airways
GoAir
Air India
Linear (IndiGo)
Source: DGCA, MOSL
Key terms used throughout the report
ASK: Available Seat Kilometer - The Basic Measure of Capacity:
One seat (empty or
filled) flying one kilometer is an ASK. A 180-seat A320 flying 100 kilometers creates
18,000 ASKs.
RPK: Revenue Passenger Kilometer - The Basic Measure of Revenue:
A paying
passenger flying one kilometer creates an RPK. 150 passengers flying 100 kilometers
generate 15,000 RPKs.
Load Factor: Production Compared to Capacity:
To calculate the load factor, divide
RPKs by ASKs. An individual flight generating 15,000 RPKs and 18,000 ASKs will have
a load factor of 83%. Higher load factors are desirable but how much each
passenger pays is also important.
22 January 2018
5

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The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person
or to the media or reproduced in any form, without prior written consent. This report and information herein is solely for informational purpose and may not be used or considered as an offer document or solicitation of
offer to buy or sell or subscribe for securities or other financial instruments. Nothing in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or
appropriate to your specific circumstances. The securities discussed and opinions expressed in this report may not be suitable for all investors, who must make their own investment decisions, based on their own investment
objectives, financial positions and needs of specific recipient. This may not be taken in substitution for the exercise of independent judgment by any recipient. Each recipient of this document should make such investigations
as it deems necessary to arrive at an independent evaluation of an investment in the securities of companies referred to in this document (including the merits and risks involved), and should consult its own advisors to
determine the merits and risks of such an investment. The investment discussed or views expressed may not be suitable for all investors. Certain transactions -including those involving futures, options, another derivative
products as well as non-investment grade securities - involve substantial risk and are not suitable for all investors. No representation or warranty, express or implied, is made as to the accuracy, completeness or fairness of
the information and opinions contained in this document. The Disclosures of Interest Statement incorporated in this document is provided solely to enhance the transparency and should not be treated as endorsement of the
views expressed in the report. This information is subject to change without any prior notice. The Company reserves the right to make modifications and alternations to this statement as may be required from time to time
without any prior approval. MOSL, its associates, their directors and the employees may from time to time, effect or have effected an own account transaction in, or deal as principal or agent in or for the securities
mentioned in this document. They may perform or seek to perform investment banking or other services for, or solicit investment banking or other business from, any company referred to in this report. Each of these entities
functions as a separate, distinct and independent of each other. The recipient should take this into account before interpreting the document. This report has been prepared on the basis of information that is already
available in publicly accessible media or developed through analysis of MOSL. The views expressed are those of the analyst, and the Company may or may not subscribe to all the views expressed therein. This document is
being supplied to you solely for your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, copied, in whole or in part, for any purpose. This report is not
directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would
be contrary to law, regulation or which would subject MOSL to any registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in all jurisdictions or to
certain category of investors. Persons in whose possession this document may come are required to inform themselves of and to observe such restriction. Neither the Firm, not its directors, employees, agents or
representatives shall be liable for any damages whether direct or indirect, incidental, special or consequential including lost revenue or lost profits that may arise from or in connection with the use of the information.
The
person accessing this information specifically agrees to exempt MOSL or any of its affiliates or employees from, any and all responsibility/liability arising from such misuse and agrees not to hold MOSL or any of its affiliates or
employees responsible for any such misuse and further agrees to hold MOSL or any of its affiliates or employees free and harmless from all losses, costs, damages, expenses that may be suffered by the person accessing this
information due to any errors and delays.
Registered Office Address: Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai-400025; Tel No.: 022-3980 4263; www.motilaloswal.com. Correspondence Address: Palm Spring
Centre, 2nd Floor, Palm Court Complex, New Link Road, Malad (West), Mumbai- 400 064. Tel No: 022 3080 1000. Compliance Officer: Neeraj Agarwal, Email Id:
na@motilaloswal.com,
Contact No.:022-30801085.
Registration details of group entities.: MOSL: SEBI Registration: INZ000158836; CDSL: IN-DP-16-2015; NSDL: IN-DP-NSDL-152-2000; Research Analyst: INH000000412. AMFI: ARN 17397. Investment Adviser: INA000007100.
Motilal Oswal Asset Management Company Ltd. (MOAMC): PMS (Registration No.: INP000000670) offers PMS and Mutual Funds products. Motilal Oswal Wealth Management Ltd. (MOWML): PMS (Registration No.:
INP000004409) offers wealth management solutions. *Motilal Oswal Securities Ltd. is a distributor of Mutual Funds, PMS, Fixed Deposit, Bond, NCDs, Insurance and IPO products. * Motilal Oswal Commodities Broker Pvt. Ltd.
offers Commodities Products. * Motilal Oswal Real Estate Investment Advisors II Pvt. Ltd. offers Real Estate products. * Motilal Oswal Private Equity Investment Advisors Pvt. Ltd. offers Private Equity products
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