Indian budget carrier Go First’s losses have widened this financial year and the airline has cited several reasons in its recent reports. While COVID has impacted its revenue, the anchored fleet due to engine shortages has also affected its balance sheet.
Go First posted a net loss of about $218 million in fiscal 2022, according to its regulatory filing. That was twice as much as last year, when the company posted a net loss of around $105 million.
The filing was seen by Business Standard, which reports that the airline blamed successive waves of COVID as well as its grounded fleet as the main reasons behind the cash loss.
However, the company’s overall revenue increased despite the reduced capacity as travel gradually increased over the months. The airline’s revenue increased by 92.64% from US$263 million to US$506 million during the same period.
It also said that as infections fell and passengers returned, there was a significant improvement in its occupancy rate, reaching nearly 80% in March 2022.
According to ch-aviation, Go First has 58 aircraft in its fleet, of which only 31 are actively flying. Business Standard reports that 90% of the carrier’s A320s are equipped with Pratt & Whitney engines and about 20 aircraft are grounded due to supply chain issues facing P&W.
India’s aviation regulator, the Directorate General of Civil Aviation, DGCA, mandated that all aircraft must have modified engines on both sides, and P&W committed to the airline to supply the engines on time. But the delay forced Go First to significantly reduce capacity due to grounded planes.
Go First also explained the delay in launching the IPO, citing the Russia-Ukraine crisis and the Omicron wave earlier this year as the primary reasons for not proceeding with the IPO.
Go First was one of several companies in India that filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) last year.
The rules mandate that a company must launch an IPO within 12 months of SEBI approval. It was extended for another six months during the pandemic, but is now back to 12 months.
The airline wanted to raise about $463 million, most of which would go toward settling outstanding debts. He will now have to file his IPO papers again with SEBI to get another chance at it.