IS AIR INDIA’s LOSS REPRESENTATIVE OF THE SECTOR?
Air India’s record loss for the financial year ended March 2026 may reflect the struggles of the country’s aviation sector, but it is far worse than its peers, analysts said.
This is because the airline – in which Singapore Airlines owns a 25.1 per cent stake – is in the middle of a complex turnaround. It is integrating Vistara after their November 2024 merger, modernising its fleet, dealing with legacy costs and carrying much greater exposure to long-haul international routes.
IndiGo – India’s largest and most profitable carrier in recent years – has yet to announce its Q4 and full year FY2026 financials, but analysts CNA spoke to expect it to report a Q4 loss.
Around 40 per cent of IndiGo’s international capacity is exposed to the Middle East, noted Ameya Joshi, founder of aviation analysis website Network Thoughts.
Besides, the airline has not been able to operate in growing international routes including Uzbekistan, Kazakhstan, Russia, and other countries in Central Asia, he said.
Network Thoughts’ Joshi said Air India’s losses are “not representative of the sector”. Instead, much of it is linked to airspace closures and large pre-delivery payments to support its aircraft orders.
Air India had ordered a total of 220 Boeing aircraft and 360 Airbus aircraft since 2023, according to an Aviation Week report in January.
Air India is the second-largest airline in India, with 3.6 million seats and a 14 per cent share of the market as of May, according to OAG data. Its low-cost domestic carrier, Air India Express, is the third-largest airline with 2.5 million seats.
OAG’s Patel noted that FY2026 was the first full year of consolidated results after Air India’s merger with Vistara – the airline formerly co-owned by Tata Group and Singapore Airlines – making the year-on-year comparison less straightforward.
Singapore Airlines has attributed Air India’s performance to a combination of geopolitical disruption, fuel costs and transformation-related expenses.
ICRA expects the Indian aviation industry to report a net loss of 110 billion to 120 billion rupees (US$1.1 billion to US$1.2 billion) in FY2026-2027. It also revised its outlook on the Indian aviation sector to “negative” from “stable” in March 2026, citing higher ATF prices, international airspace disruptions and continued rupee depreciation.
IndiGo remains in a stronger position than Air India. With a 52 per cent market share, it has stayed profitable in recent years but analysts expect pressure to show in its fourth quarter FY2026 numbers.
In May 2026, IndiGo operated 13.4 million seats, a 5 per cent increase from the previous year, as per OAG data.
As for India’s next-largest carriers SpiceJet and Akasa Air, analysts noted they are much smaller players, each with less than 5 per cent domestic market share and even smaller international exposure.
Patel, however, said SpiceJet is the airline most vulnerable to a controlled wind-down or forced consolidation if conditions do not improve, given its already strained balance sheet and limited safety net.
