The only regional airline in India - Air Costa - is planning to become a scheduled airline soon with pan-India connectivity and it has applied to the Directorate General of Civil Aviation (DGCA) for the status change.

Giving details of the plans, the Chairman of Air Costa, Ramesh Lingamaneni told SP’s Aviation that the process may take about three months, around the same time it will be taking on lease another two Embraer aircraft (in February-March) and another two in July-August, taking the total aircraft with the airline to eight. Air Costa is one year old as of date and the company is celebrating its first anniversary with ambitious plans in the pipeline.

"We have planned our moves carefully. We want to go slow and steady."

— Ramesh Lingamaneni Chairman, Air Costa

 

“We are here to connect underserved and virgin destinations and we see potential.”

— Capt. K.N. Babu, CEO Air Costa

 

Ramesh Lingamaneni said that the airline would also go international as and when the 5/20 rule (five years operation and 20 aircraft) is relaxed, either on its own or with an international tie-up, both options being open. However, he was categorical that for national routes it would firmly stick with Embraer aircraft and for international operations it would look at suitable aircraft. He mentioned that some international players had been evincing interest in the airline, but ‘Air Costa is in no hurry’. "We have planned our moves carefully. We want to go slow and steady."

The airline, he said, would be achieving operational break-even this month and is expected to achieve total break-even by March 2015, thanks to the ‘good passenger load factors’ the airline is witnessing. The average passenger load factor is at 71 per cent.

Ramesh Lingamaneni said that the airline industry was fraught with challenges and Air Costa is ready to overcome them, whether it is capital infusion or regulatory. He is hopeful that the present government at the Centre would effect necessary reforms in the aviation sector and that the Minister for Civil Aviation has shown positive movement.

Clarifying on the pan-India connectivity, the CEO of Air Costa, Capt. K.N. Babu said that the airline would ‘play to its core strength’ that of connecting Tier II and III cities to the major metros. “We are here to connect underserved and virgin destinations and we see potential.”

Demerger

The Chief Financial Officer, Vivek Choudhary told SP’s Aviation that Air Costa which is part of the LEPL Group, the holding company which has interests in Real Estate, Infrastructure, Power etc, would be going in for demerger soon. The new entity will be called LEPL Airlines Pvt Ltd and in doing so the company will be able to attract private equity investments to fund its future expansion plans.

More to follow...