Investors prefer airports, MROs over airlines: CAPA survey

Mumbai, June 13 (UNI) Global fund managers are now finding airports more attractive than airlines to invest in, followed by cargo and logistics and maintenance, repairs and overhaul (MROs).

India is, however, flying high with the country considered as the most attractive emerging nation to invest in the aviation sector along with China. According to a recent survey, India is considerably ahead of West Asia, Brazil and east European markets. The Centre of Asia Pacific Aviation (CAPA) carried out the survey among national and international investors which shows investments in airlines only preceded those in duty-free retail, business jets and in-flight catering.

Airports seem to have caught the fancy of investors with over 86 per cent viewing investment opportunities. A similar proportion (82 per cent) favoured greenfield metro sites such as Navi Mumbai as of greatest interest.

Investors who want to invest in the Indian airline business prefer low-cost carriers (LCCs) despite their losses. Only 40 per cent of them said they may invest in full-service carriers, while an overwhelming 80 per cent showed interest in LCCs.

In fact, international LCCs, which will be a reality soon as Indian LCC's get approval to start international services, could be the next big investment opportunity for investors.

On the current foreign direct investment (FDI) guidelines in aviation industry, over 70 per cent of the respondents believed that the cap on foreign airlines shareholding in Indian carriers should be 49 per cent or more. Almost 64 per cent felt that the capital required to enter the industry should be raised from current level of 12 million dollars.

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