Airline's losses likely to extend
Consolidated loss of Indian airlines is likely to increase up to $4.1 billion in FY21. With that, the total loss of two years is likely to be around $8 billion.
Aviation consultancy and research firm CAPA expects the trend to improve in FY22. It has pegged the domestic passenger traffic to be around 8-9 crore in 2021-22 as against 5.25 crore in the previous financial year. However, it would still remain below the pre-covid levels as airlines had hit the passenger volume of ~14 crores in 2019-20.
CAPA has presented an optimistic view about the recovery in passenger traffic volumes. However, it is still vulnerable to the anticipated third Covid wave.
New funding For Flipkart
Japan's SoftBank is likely to make a re-entry into Flipkart after parting its way with the company three years ago. As per the emerging reports, SoftBank is considering infusing $1.2-1.5 bn into the E-commerce company.
SoftBank had sold its stake in Flipkart to Walmart for $4 billion in May 2018, pocketing $1.5 billion in profit. Reports are further suggesting that Flipkart's other investors are also looking to increase their current stake in the company.
Reach and acceptance of online sales has only expanded during the Covid-19 pandemic. And, so has the valuations of E-commerce giants like Flipkart.
The company is expected to launch its IPO in CY2022 or 2023. And, Softbank's re-entry could be seen as a part of the company's strategy to improve its valuations. As per an estimate, Softbank's investments could take the company’s valuation to $30 billion.
CEA on economy & recovery
Chief Economic Advisor KV Subramanian believes that the second Covid wave has affected the momentum of the economy. But, he is optimistic about the recovery process to start from July onwards.
In a recent interview, he stated that several states have started removing many restrictions. And, the economy will start recovering once the vaccination drive picks up speed. He also reiterated the government's commitment to achieving vaccination for all by December.
Vaccination has emerged as a key answer to overcome the effect of pandemics. However, the drive has been slow so far as India faced an acute shortage of vaccines. There is a fear of the third wave as well which could derail the prospects of recovery. And, faster vaccination is the only answer to significantly mitigate its impact.
