Mumbai: Jet Airways India, the country’s largest private carrier, on Wednesday reported lower-than-expected 11.3% rise in October-December net profit, sending its shares down as much as 3.6%.
The limited growth in net profit has been attributed to higher tax outgo and fuel prices.
While tax during the quarter witnessed a whopping increase to Rs 996.4 million from Rs 500,000 a year ago, fuel expenses rose 23.5% on year to Rs 10.97 billion.
“Crude oil prices in the recent past have been increasing and we believe that the impact of such costs will be passed on to the customer in the short to medium term without unduly affecting demand growth,” the company said in a statement.
Though the profit growth to Rs 1.18 billion from Rs 1.06 billion a year ago missed market expectations, increased air traffic helped the company better its income from operations to Rs 32.62 billion from Rs 27.23 billion.
A Reuters poll of brokerages had forecast net profit at Rs 2.59 billion.
“Industry outlook is looking tougher. Fuel prices are rising, air fares are coming down and the passenger traffic is expected to slacken,” said Mahantesh Sabarad, analyst at Fortune Equity Brokers.
He said October-December, when the country celebrates a slew of festivals, is typically the strongest quarter for the industry.
Jet said it was bullish on its international operations which account for 55% of its revenue.
“Our international operations, which continue to achieve seat factor of over 80% for more than a year, is now experiencing a healthy operating margin which augurs well for the future,” Jet said.
Seat factors in the domestic routes stood at 76.9% during the quarter.
The stock closed 1.64% lower at Rs 503.15 in the Bombay Stock Exchange that ended up 0.38%.