New Delhi, June 29 (IANS) India’s airport infrastructure sector is expected to garner investments of up to Rs 4.2 lakh crore by 2029, a report said on Monday.
The estimation includes Rs 3.7 lakh crore based on the value of projects announced and under implementation as of FY26 and project value likely to be commissioned by 2029 at nearly Rs 0.5 lakh crore, the report from Brickwork Ratings.
After robust operating revenue growth in FY26 over record passenger traffic and tariff hikes, the revenue growth in FY27 is expected to remain strong driven by domestic air traffic growth and footprint expansion.
The sector navigated an intensive capacity expansion phase in FY26, with regional airport development and terminal upgrades accelerating to absorb a structural surge in domestic travel.
“Air traffic is expected to grow by 8–10 per cent driven by resilient domestic demand, expanding Tier-2 footprints and the launch of new greenfield assets including Navi Mumbai and Jewar airports,” said Niraj Rathi, Senior Director – Ratings, Brickwork Ratings. These factors cushion a highly subdued international segment, he added.
International growth has flattened due to route restrictions, rising fuel prices, and the Middle East conflict. The Middle East constitutes a massive 38–40 per cent share of India’s entire international passenger traffic and instability in the region will have a major impact on the sector.
“These combined headwinds will likely maintain growth in H1FY27 flat and subdued, but a sharp capacity and demand recovery could occur in H2FY27 as airlines adjust schedules for peak winter travel and new airport assets scale up,” Rathi said.
The report said the credit outlook for the airport infrastructure sector is stable. Heavy spending on terminal expansions pressures near-term cash flows, but steady growth in passenger traffic keeps the industry moving forward safely.
Operating margins for FY26 surged to an estimated 53.8 per cent, up from 44.4 per cent in prior year due to completion of new terminals.
Margins are projected to improve to 54.5 per cent in FY27 as these expanded facilities open up, allowing operators to collect high-margin retail fees and airport charges from a larger volume of passengers.
Tailwinds for the sector include UDAN initiative with a capital outlay of Rs 288 billion by FY36, and the 100 per cent FDI being permitted in greenfield airport development projects.
—IANS
aar/pk
