Indus Airways Limited


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Indus Airways Limited

  1. 1. May 27, 2009 Indus Airways Limited Corporate Overview New Opportunity in Indian Space
  2. 2. Who we are? <ul><li>Founded on March 31, 2004 at New Delhi, India with an objective to connect regional cities to the main cities. </li></ul><ul><li>License to operate scheduled transport service (Passenger / Cargo) obtained in November, 2006. </li></ul><ul><li>Started Operations from December, 2006 to March, 2007 on Delhi – Chandigarh – Mumbai route with 1 CRJ – 200 (50 Seated) Aircraft. Average occupancy was 56% without any major advertisement. </li></ul><ul><li>Operation stopped in April, 2007 because of lack of support from Aircraft Manufacturer (Spares) & Lack of Working Capital. </li></ul>
  3. 3. Why Now? <ul><li>Unexplored market: </li></ul><ul><li>India Lives in Villages. Most of Small & Medium Enterprises need to grow with India Economy & hence would attract lot of traveling from the regional cities to the main stream cities like Delhi, Mumbai, Chennai, Kolkata & Bangalore. </li></ul><ul><li>At the moment Per Capita Per Annum is 0.02 trips, which would be increase substantially given the Indian Economy is growing at 8% P.A. </li></ul><ul><li>As per Ministry of Civil Aviation, India, it is forecasted that India would be the second fastest growing travel and tourism economy in the world </li></ul><ul><li>Indian Aviation growth rate will be 20-25% p.a. and the regional sector is expected to grow at whopping 40%. </li></ul><ul><li>Opportunity: </li></ul><ul><ul><li>High growth potential market </li></ul></ul><ul><ul><li>Changing Population Demographics </li></ul></ul><ul><ul><li>Growing Tourist Traffic </li></ul></ul><ul><ul><li>Surging Air Traveller’s Base </li></ul></ul><ul><ul><li>The second fastest growing travel and tourism economy in the world </li></ul></ul><ul><ul><li>Airport infrastructure improvement opening up new sectors </li></ul></ul>
  4. 4. Market Size - India <ul><li>India is the second largest aviation industry of the world. </li></ul><ul><li>India Civil Aviation growth, at 20% is among highest in the world. </li></ul><ul><li>By 2010 India’s Fleet Strength will stand at 500-550 which is 260 at present. </li></ul><ul><li>In 2010 domestic market will cross 60 Million Travellers. </li></ul><ul><li>Continuous growth with 7% increase in the number of flights into and out of India (An additional 835 flights and more than 2 Lacs Seats a month. </li></ul><ul><li>Number of Flights doubled from 6800 in May 2001 to 13200 in May 2007. </li></ul><ul><li>CAPA predicts that domestic traffic will grow at 25-30 percent a year until 2010. </li></ul><ul><li>Currently Air Travelers are 0.8% of the population. </li></ul><ul><li>By 2020, Indian airports are estimated to handle: </li></ul><ul><ul><li>100 million passengers </li></ul></ul><ul><ul><li>Including 60 million domestic passengers </li></ul></ul><ul><ul><li>Cargo in the range of 3.4 million tones per annum </li></ul></ul>
  5. 5. Competition <ul><ul><li>Indus Unique Positioning will be less competitive and it gives huge opportunity to become leader in its region. </li></ul></ul>Full Service Carriers (FSC) Low Cost Carriers (LCC) Regional National Indian Airlines Jet Airways Air India Kingfisher Airlines Indus Air Paramount Air Spice Jet Air Deccan Indigo Jet Lite Go Air
  6. 6. Value Proposition <ul><li>Indus Air will position itself as a “Full Service Carrier” </li></ul><ul><ul><ul><ul><ul><li>Offers in-flight service </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Single class aircraft configuration </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Internet booking </li></ul></ul></ul></ul></ul><ul><li>Single Aircraft strategy - CRJ - 200 </li></ul><ul><li>Offering non-trunk short-haul routes and attracting high-end railway traffic through comparable fares </li></ul><ul><li>Indus Air will offer good fares to stimulate demand. </li></ul><ul><li>Mostly New B Cities Routes are selected in the way to offer more air space to new people and to benefit from low competition. </li></ul><ul><li>Company will create monopoly in such routes, as such no / few flights are operating. </li></ul><ul><li>Indus will reduce costs and increasing utilisation by: </li></ul><ul><ul><ul><li>Reducing the costs of its operations </li></ul></ul></ul><ul><ul><ul><li>Providing Luxury to all </li></ul></ul></ul><ul><ul><ul><li>Seeking high aircraft utilisation </li></ul></ul></ul><ul><ul><ul><li>Providing a safe and on-time service </li></ul></ul></ul><ul><ul><ul><li>Increasing ancillary revenues </li></ul></ul></ul>
  7. 7. Target Focus <ul><li>Targeting companies in Chandigarh, Amritsar, Lucknow, Varanasi, Srinagar and Jabalpur with annual revenues of 50 Crores and more. </li></ul><ul><li>80% focus on Business Class Clientele and 20% rest others. </li></ul>
  8. 8. Routes <ul><li>Indus Air will operate on following routes </li></ul><ul><ul><li>Mumbai – Chandigarh – Amritsar – Chandigarh – Mumbai </li></ul></ul><ul><ul><li>Mumbai – Lucknow – Varanasi – Lucknow – Mumbai </li></ul></ul><ul><ul><li>Delhi – Srinagar – Amritsar – Srinagar – Delhi – Lucknow – Delhi </li></ul></ul><ul><ul><li>Delhi – Chandigarh – Amritsar – Chandigarh – Delhi – Varanasi – Delhi </li></ul></ul><ul><ul><li>Delhi – Jabalpur – Mumbai – Jabalpur – Delhi </li></ul></ul>
  9. 9. Our Clients <ul><li>We will target following companies. </li></ul><ul><ul><li>Chandigarh </li></ul></ul><ul><ul><ul><li>Infosys, IBM Daksh, Net Solutions, HP India, SAP Labs, ICICI, Nectar Life sciences, Ind-Swift Laboratories etc and NRIs. </li></ul></ul></ul><ul><ul><li>Amritsar </li></ul></ul><ul><ul><ul><li>Business Class and Visitors to Golden Temple </li></ul></ul></ul><ul><ul><li>Lucknow </li></ul></ul><ul><ul><ul><li>IOC, HPCL, BPCL, Reliance, TCS, IBM, Citibank, ABN Amro etc. </li></ul></ul></ul><ul><ul><li>Varanasi </li></ul></ul><ul><ul><ul><li>Business Travelers & Holy Pilgrims. </li></ul></ul></ul><ul><ul><li>Srinagar </li></ul></ul><ul><ul><ul><li>Business Travelers & Tourist. </li></ul></ul></ul><ul><ul><li>Jabalpur </li></ul></ul><ul><ul><ul><li>Ordinance Factory, Star Delta Transformers, BHEL, Power Grid Corp., Tata, RPG Transmission. </li></ul></ul></ul>
  10. 10. Growth Facts Apr, 2007 Airline Stopped due to lack of support of spares and working capital. Mar, 2007 3 Months of Successful run of CRJ -200 Aircraft at 75% Capacity Dec, 2006 Commercial Launch of First Flight Nov, 2006 Got 2 CRJ 200 Aircraft on lease. Nov, 2006 Got License to operate as Scheduled Airline from DGCA Mar, 2004 Incorporation of Company Growth
  11. 11. Founder & Management Team Core leadership team with average experience of 10 years Brig. Kapil Mohan | Founder Role: Strategy and planning Capt. N K Beri | Founder Role: Strategy and Planning Capt. Deep Beri | Director Role: Strategy, operations, process and planning Capt. A.P.C. Kapoor | CEO Role: Operations, Selection & Training of Pilots, Technical Guidance Capt. V P Kapoor | General Manager Role: Flying Crew Standard & Air Safety Capt. M S Sandhu | General Manager Role: Operations & Logistics
  12. 12. Investment Rationale <ul><li>The Company has been granted an NOC to Operate Scheduled Air Transport Services in India. </li></ul><ul><li>The Company has already obtained DGCA Approvals for five routes, therefore ensuring substantial saving in time. </li></ul><ul><li>The Company has already launched its airline. </li></ul><ul><li>Indus Team is very experienced and best in getting leased airplanes deals in country. </li></ul><ul><li>Promoter having valuable corporate experience and relationship. </li></ul><ul><li>Good Investment Opportunity – early stage financing, but without the startup time normally involved in such a project. </li></ul><ul><li>Airline launched on December 14, 2006, Potential Private Equity / Strategic Investors have an opportunity to become significant shareholders in Indus Air and share in the significant upside potential on this project. </li></ul><ul><li>23.7% growth rate in passengers traveling through air transport given by Directorate General of Civil Aviation. Indian Aviation Industry to grow at 20% p.a. Other airlines working on 80% load factor. </li></ul><ul><li>Easy to penetrate in air travel in India right now, as Indus Air has plans to run airlines in small cities thereby connecting the Indian Middle Class to the World. </li></ul>
  13. 13. Early Investor Gain Share Price Grew at a CAGR of 23% over the period 1990 - 2003 Share Price appreciated to 4x IPO price within 18 months of listing Intially promoters put in USD 10 Mn in November, 199, In March 2002, 50% of the stake was sold for AUSD 500 Mn to Patrick Group Company opt for IPO in May, 2006 at 15 X of its face value. From Rs. 6 In October 2004, it went upto 102 in August 2005. Company opt for IPO in February, 2005 at 110 X of its face value. Share Price rose 70% within the first year of listing price has been risen more than 500% since the IPO in 1997 The Airline began operations in December 2001. In June 2003, 3 new financial partners invested in the company at a valuation of USD 100 Mn.
  14. 14. New Delhi Sundeep Sehgal - CFO [email_address] cell: +919810005572 Offices: Thank you for your interest . Thank You