According to Centre for Asia Pacific Aviation (CAPA)  India’s airlines posted a combined loss of $1.65 billion (Rs 9,270 crore as on May 29) in 2012-13 ($1.15 billion if Kingfisher is excluded), down from approximately $2.28 billion (Rs 12,809 crore) the previous year, according to a report by Centre for Asia Pacific Aviation (CAPA).    

More than 40 per cent of the loss was incurred in the last quarter alone, squandering the improved performance posted during the first nine months of the year. Kingfisher’s exit from the Indian aviation sector was one of the most significant developments for the market in FY13.    

It highlighted the fragility of the sector. But as a result of the removal of Kingfisher’s seats, combined with the modest capacity induction by other carriers, the demand-supply dynamics in the market started to favour airlines for the first time since 2004, the report said. This was reflected positively in the average fares which increased by 15-20 per cent year-on-year. India’s airlines were showing signs of a steady recovery in financial performance during the first three quarters of FY13, but a weak fourth quarter hurt the sector.    

Aggressive discounting during the traditionally weak period between January and March resulted in losses of $700 million (Rs 3,933 crore as on May 29) during this quarter alone, CAPA said.    

The cost scenario remained difficult throughout the year with the depreciation of the rupee and continued high oil prices being the key challenges. Over the 12 months to March 31, 2013, with carriers moving to fill the space vacated by Kingfisher, all airlines except Jet Konnect saw an increase in their domestic market share over the previous year, but IndiGo gained the most.