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Just three years into operations, AirAsia
India may still be considered a new kid
on the block in a mature low-cost carrier
market. But it is fast proving itself to be
a force to be reckoned with. It has big
ambitions to connect more and more
Tier II and III cities within the large Indian
subcontinent, with a longer-term view of
going international; and its performance in
2017 indicates it is well on the way not just
to achieve its goals, but to do so quickly.
During the year, it increased its fleet size
75% from eight to 14; added five new
destinations to its network – Srinagar
(Kashmir), Ranchi (Jharkand), Bagdogra
(West Bengal), Kolkata (West Bengal)
and Bhubaneswar (Odisha); and doubled
the number of guests carried to 4 million.
Following a survey carried out during the
year, OAG, the world’s leading provider
of digital flight information, ranked our
associate as the 10th fastest growing
airline in the world.
Most impressively, its prodigious growth
is being managed cost effectively. Despite
consciously reducing its average stage
length, AirAsia India doubled its revenue
to INR15,369 million and, best of all,
achieved its first ever full-year gross
profit.
No doubt, some of this growth is fuelled
by demand. While competition in India
is stiff, with a large and growing number
of airlines including low-cost operators,
demand still outweighs supply. India is
currently considered the third-largest
domestic civil aviation market in the world.
During the year, capacity as measured
by number of seats increased by 14%,
while the number of passengers carried
increased by 17%, and the industry load
factor grew three percentage points.
According to the Directorate General of
Civil Aviation (DGCA), from April 2006 to
March 2017, domestic passenger traffic
expanded at a compounded annual growth
rate (CAGR) of 11.46%.
Demand on its own, however, does
not explain our affiliate’s phenomenal
performance. In a land of much choice,
AirAsia India is doing many things right to
command the growth it is experiencing.
Marketing is probably one. The Dotcom
brand campaign – One Destination for
All Destinations, Women’s Day campaign
and Independence Day campaign, among
others, are portraying AirAsia India
in just the right light, marking it as an
organisation with a sense of humour that
takes social issues to heart. They have
also brought Head of Marketing Anupama
Jangid recognition; she was named Digital
Marketer of the Year in the Travel Category
by the Internet and Mobile Association of
India (IAMAI).
The One Destination for All Destinations
campaign, which aimed at increasing
awareness of how easy it is to make
travel bookings on the airline’s website
and the mobile app, was so successful,
it saw a 53.5% increase in online and
app bookings, and 85% growth in app
downloads, taking AirAsia’s total app base
in India to 1.4 million, far ahead of other
low-cost carriers in the country.
GrowingFast
andFurious
REVENUE
INR 15.36
BILLION
[ ]
AirAsia Group Berhad
BUSINESS REVIEW
127