Non-aero revenues fly for airports

Hyderabad: Approximately 70% of airport revenues across the country accrue from aeronautical operations like landing and parking, passenger service fees and cargo-related services like terminal and X-Ray charges, says a KPMG study. Compared with this, internationally, a major portion of revenues are via by non-aero or cityside operations and properties accounting for between 60-80%.
However, with the advent of private sector managements of airports like the GMR- run Delhi International Airport Ltd (DIAL), and the GVK-operated Mumbai International Airport Ltd (MIAL), the revenue mix in India, too, is changing fast.Their past experience as real estate developers of and hospitality properties, as in the case of GVK, has contributed to the aggressive focus on non-aero revenues such as land and space rentals, trading concessions, among others.
According to a KPMG study, aeronautical revenues are largely dependent on passenger traffic and tariffs, which are highly regulated and factors that are largely external and beyond the control of the airport operator. However, non-aeronautical revenue stream is a niche segment, with huge potential for exploring revenue enhancement as the rates are not regulated, it says.
29/01/07 C Chitti Pantulu/Daily News & Analysis

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