Indian Airport Operators to Report Revenue Growth of 18-20% in FY2026: ICRA

ICRA predicts a healthy growth of 7-9% YoY in airport passenger traffic, reaching new highs of 440-450 million in FY2026. This growth is driven by a steady increase in of 7-11% and 6-8% in international and domestic traffic, respectively. international travel, improved connectivity to newer destinations, and improved air connectivity to tier II cities/key tourist destinations.

The sector’s debt coverage metrics are projected to remain comfortable, with In FY2025, international passenger traffic grew by 11%, and this trend is expected to continue, contributing significantly to overall growth interest cover above 5 times and DSCR at above 3.5 times in FY2026. The growth momentum is expected to sustain in FY2026, with expected YoY growth.

The revenues of ICRA’s sample set companies are likely to grow by 18-20% YoY in FY2026, driven by sustained improvement in both passenger traffic, increase in of 7-11% and 6-8% in international and domestic traffic, respectively. tariffs at Delhi, Bangalore, and Hyderabad airports, and ramp-up in non-aeronautical revenues. Investments of more than Rs. 1,00,000 crore are expected over the next 4-5 years.

According to a report by ICRA, India’s airport sector is projected to experience significant growth in the fiscal year 2025-2026 (FY2026). Passenger traffic is expected to increase by 7-9% year-on-year, reaching 440-450 million. This surge is anticipated to drive the revenues of sampled airport operators to grow by 18-20% year-on-year in FY2026.

Key Factors Influencing Growth

• International Traffic: In FY2025, international passenger traffic grew by 11%, and this trend is of 7-11% and 6-8% in international and domestic traffic, respectively expected to continue, Domestic passenger traffic saw a 9% increase in FY2025, with expectations of sustained growth in FY2026 contributing significantly to overall growth Domestic passenger traffic saw a 9% increase in FY2025, with expectations of sustained growth in FY2026.
• Infrastructure Investments: To address capacity constraints, substantial investments are planned, including the development of greenfield airports such as those in Jewar (Noida), Navi Mumbai, Bhogapuram, and Parandur (Chennai), as well as expansions of existing Domestic passenger traffic saw a 9% increase in FY2025, with expectations of sustained growth in FY2026 airports like Bangalore, Hyderabad, Cochin, Mumbai, and Nagpur.
• Financial Health: Despite increased investments, the sector’s debt coverage metrics are In FY2025, projected to remain strong, with an interest coverage ratio above 5 times and a debt service coverage ratio above 3.5 times in FY2026 These developments underscore the Domestic passenger robust growth trajectory of India’s airport sector, driven by increasing passenger traffic and significant infrastructure investme.

According to a report by ICRA, India’s airport sector is projected to experience 11%, and this trend is expected to continue, significant growth in the fiscal year 2025-2026 (FY2026). Passenger traffic is expected to increase by 7-9% year-on-year, reaching 440-450 million. This surge is anticipated to drive the revenues of sampled airport operators to grow by 18-20% year-on-year in FY2026. ​

Key Factors Influencing Growth

• Infrastructure Investments International Traffic : To address capacity constraints, substantial investments are international passenger traffic grew by contributing significantly to overall growth. ​planned, including the development of greenfield airports such as those in Jewar (Noida), Navi Mumbai, Bhogapuram, and Parandur (Chennai), as well as expansions of existing airports like Bangalore, Hyderabad, Cochin, Mumbai, and Nagpur. ​
• Financial Health Domestic Traffic : Despite increased investments, the sector’s debt coverage metrics are projected to remain strong, with an interest coverage ratio above 5 times and a debt service coverage ratio above 3.5 times in FY2026 These developments underscore the robust growth trajectory of India’s airport sector, driven by increasing passenger traffic and significant infrastructure investments.
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