CAPA - Ground Handling Report
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Transcript of CAPA - Ground Handling Report
CAPA India Ground Handling Report 2014
Table of Contents & Sample Extracts
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Table of Contents
Glossary.............................................................................................................................. 2
Executive Summary ............................................................................................................ 4
Global Overview of Ground Handling ............................................................................... 24
India Aviation Overview ................................................................................................... 45
Passenger traffic ....................................................................................................................... 45
Air transport movements .......................................................................................................... 46
Cargo traffic .............................................................................................................................. 48
Fleet Size ................................................................................................................................... 49
CAPA traffic and movements forecast to FY2023 ....................................................................... 50
Profiles of 10 Largest Indian Airports ................................................................................ 59
Delhi Airport ............................................................................................................................. 59
Mumbai Airport ........................................................................................................................ 67
Bengaluru Airport ..................................................................................................................... 75
Chennai Airport ......................................................................................................................... 82
Kolkata Airport .......................................................................................................................... 89
Hyderabad Airport .................................................................................................................... 95
Cochin Airport ......................................................................................................................... 102
Ahmedabad Airport ................................................................................................................ 108
Goa Airport ............................................................................................................................. 114
Pune Airport ........................................................................................................................... 119
SWOT Analysis of Metro Airports from a Ground Handler’s Perspective ........................ 125
Bengaluru Airport ................................................................................................................... 125
Hyderabad Airport .................................................................................................................. 126
Chennai Airport ....................................................................................................................... 127
Kolkata Airport ........................................................................................................................ 128
Mumbai Airport ...................................................................................................................... 129
Delhi Airport ........................................................................................................................... 130
Ground Handling Market in India ................................................................................... 131
Ground Handling Costs ................................................................................................... 137
Subcontracting of Ground Handling Activities ................................................................ 143
Regulatory Framework ................................................................................................... 147
Profiles of Key Ground Handlers ..................................................................................... 153
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Air India SATS Airport Services ................................................................................................ 154
Bhadra India ............................................................................................................................ 157
Bird Worldwide Flight Services (BWFS) .................................................................................... 159
Cambata Aviation Pvt. Ltd. ...................................................................................................... 161
Çelebi India ............................................................................................................................. 163
Çelebi NAS Airport Services India Pvt. Ltd. ............................................................................... 165
GlobeGround India .................................................................................................................. 167
Indo Thai ................................................................................................................................. 169
Menzies Group ........................................................................................................................ 171
SWOT Analysis of Key Ground Handlers ......................................................................... 174
Delhi Airport – AISATS Airport Services Pvt. Ltd. ...................................................................... 174
Delhi Airport – Cambata Aviation Pvt. Ltd. .............................................................................. 175
Delhi Airport – Çelebi Ground Handling Delhi Pvt. Ltd. ............................................................ 176
Delhi Airport – Bird Worldwide Flight Services Pvt. Ltd. ........................................................... 178
Mumbai Airport – Air India ...................................................................................................... 179
Mumbai Airport – Cambata Aviation Pvt. Ltd. ......................................................................... 180
Mumbai Airport – Çelebi‐NAS Airport Services India Pvt. Ltd. .................................................. 181
Bengaluru Airport – AISATS Airport Services Pvt. Ltd. .............................................................. 182
Bengaluru Airport – GlobeGround (India) Pvt. Ltd. .................................................................. 183
Chennai Airport – Air India ...................................................................................................... 184
Chennai Airport – Bhadra International India Ltd. ................................................................... 185
Chennai Airport – Cambata Aviation Pvt. Ltd. .......................................................................... 186
Kolkata Airport – Bhadra International India Ltd. .................................................................... 187
Kolkata Airport – Air India ....................................................................................................... 188
Hyderabad Airport – AISATS .................................................................................................... 189
Hyderabad Airport – Menzies Bobba Ground Handling Services Pvt. Ltd. ................................. 190
Selection of Ground Handlers by Airlines ........................................................................ 191
Introduction ............................................................................................................................ 191
Delhi Airport ........................................................................................................................... 193
Mumbai Airport ...................................................................................................................... 193
Chennai Airport ....................................................................................................................... 194
Kolkata Airport ........................................................................................................................ 195
Bengaluru Airport ................................................................................................................... 195
Hyderabad Airport .................................................................................................................. 196
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CAPA Survey of Key Stakeholders ................................................................................... 198
Ground Handlers ..................................................................................................................... 198
Airlines .................................................................................................................................... 202
Airport Operators .................................................................................................................... 207
General Aviation ..................................................................................................................... 212
Analysis of Ground Handling Tariffs at Metro Airports in India in FY2014 ....................... 214
Delhi Airport ........................................................................................................................... 214
Mumbai Airport ...................................................................................................................... 215
Chennai Airport ....................................................................................................................... 217
Kolkata Airport ........................................................................................................................ 219
Bengaluru Airport ................................................................................................................... 220
Hyderabad Airport .................................................................................................................. 221
Appendices ..................................................................................................................... 223
Appendix A: Domestic air transport movements by aircraft type ............................................ 223
Appendix B: Ceiling rates of ground handling services at metro airports in India ..................... 224
Appendix C: List of ground handling subcontractors at metro airports in India ........................ 225
Appendix D: List of ground/cargo handlers at Indian airports .................................................. 226
Appendix E: Minimum and average wage rates of personnel in ground handling ..................... 228
Appendix F: List of ground/cargo handlers covered under study for financial analysis ............. 229
Appendix G: Financial analysis of ground/cargo handling firms at Delhi Airport ...................... 231
Appendix H: Financial analysis of ground/cargo handling firms at Bengaluru Airport ............... 247
Appendix I: Financial analysis of ground/cargo handling firms at Bengaluru Airport ................ 263
Appendix J: Financial Analysis of ground/cargo handling firms at Kolkata Airport ................... 268
Appendix K: Financial Analysis of ground/cargo handling firms at Hyderabad Airport ............. 270
Appendix L: Financial Analysis of ground/cargo handling firms at Lucknow, Jaipur airports ..... 271
Appendix M: Financial Analysis of ground/cargo handling firms at Cochin Airport ................... 272
Appendix N: Financial Analysis of ground/cargo handling firms at Bhubaneshwar Airport ....... 274
Appendix O: Financial analysis of ground/cargo handling firms at Trivandrum airport............. 275
Appendix P: Ground support equipment with select designated ground handling firms .......... 276
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Figure 12: Air traffic movements by aircraft type, FY13
Source: CAPA Research, AirportIS Note: Wide body operations on domestic routes were mainly positioning flights
The majority of Indian domestic routes have a flight time of 2.5 hours or less making them most
suitable for narrow body or regional aircraft. In the future, on high density routes at slot‐constrained
airports such as Mumbal we may see the deployment of wide body aircraft, however these will
account for a relatively small share of the national total.
International services operated by foreign carriers are dominated by wide body aircraft, however the
proportion of narrow body equipment has been increasing as a result of the entry of low cost
carriers operating regional international routes to India from the Gulf and Southeast Asia. And going
forward, re‐engined A320neos and 737 MAX aircraft will be economical over a longer range making
them suitable for deployment to a larger number of international destinations.
Table 5: Top 10 markets for passenger handling, international services, wide body aircraft, FY13
Airport Estimated market size (USD million/year)
Delhi xx.x – xx.x
Mumbai xx.x – xx.x
Chennai xx.x – xx.x
Bengaluru xx.x – xx.x
Cochin xx.x – xx.x
Hyderabad xx.x – xx.x
Kolkata xx.x – xx.x
Trivandrum xx.x – xx.x
Calicut xx.x – xx.x
Ahmedabad xx.x – xx.x
Source: CAPA Research
Market segment
Domestic
Narrow ‐body 99%
Wide body1%
Wide body60‐70%
International
Narrow‐body 30–40%
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Figure 13: Estimated value of market segments for ground handling
Source: CAPA Research
The international ground handling market in India, which is the aggregate of Indian and foreign
carriers operating international services, was estimated at USDxx million in FY13 and represented
more than xx% of the market opportunity, see Figures 14 and 15. The international segment was
estimated at xx% Indian and xx% foreign carriers.
Figure 14: Estimated average market opportunity by customer segment, FY13 (USD million)*
Source: CAPA Research
xx
xx
xxDomestic flights
International flights (domestic carriers)
International Flights (foreign carriers)
Market segment
Domestic services
Indian carriers
(USD xx million) ‐ Indian carriers(USD xx million
Foreign carriers (USD xx million)
International services
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Figure 15: Relative share of domestic and international handling market by value, FY13 (%)
Source: CAPA Research,
CAPA estimates that Delhi was the largest ground handling market in India for both domestic and
international services. The top 10 market opportunities for domestic ground handling services are
listed in Table 8 and those for international services are provided in Table 9.
Table 8: Estimated top 10 market opportunities for ground handling – Domestic
Airport Market size (USD million/year)
Delhi xx.x – xx.x
Mumbai xx.x – xx.x
Bengaluru xx.x – xx.x
Chennai xx.x – xx.x
Kolkata xx.x – xx.x
Hyderabad xx.x – xx.x
Ahmedabad xx.x – xx.x
Guwahati xx.x – xx.x
Pune xx.x – xx.x
Goa xx.x – xx.x
Source: CAPA research
Table 9: Estimated top 10 market opportunities for ground handling – International
Airport Market size (USD million/year)
Delhi xx.x – xx.x
Mumbai xx.x – xx.x
Chennai xx.x – xx.x
Cochin xx.x – xx.x
Calicut xx.x – xx.x
Bengaluru xx.x – xx.x
Hyderabad xx.x – xx.x
Kolkata xx.x – xx.x
Trivandrum xx.x – xx.x
Ahmedabad xx.x – xx.x
Source: CAPA research
28%
72%
Domestic
International
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Royalty charges at metro airports
Figure 17: Royalty charges at metro airports
S.No. Airports Ground handling firms Royalty charges
1 Delhi AISATS Airport Service Pvt. Ltd xx% on the revenue earned as per the ceiling rates
Bird Worldwide Flight Services(India)Pvt. Ltd. xx% on gross revenues
Cambata Aviation Pvt. Ltd. xx% on gross revenue
Çelebi Ground Handling Delhi Pvt. Ltd. xx% on gross revenues or 12.75% on revenues earned as per the ceiling rates
2 Mumbai Air India xx% of gross revenue
Cambata Aviation Pvt. Ltd. xx% on gross revenues
Çelebi‐NAS Airport Services India Pvt. Ltd. xx% on gross revenues
3 Chennai Air India n/a
Bhadra International India Ltd xx% on gross revenues
Cambata Aviation Pvt. Ltd. xx% on gross revenues
4 Kolkata Air India n/a
Bhadra International India Ltd xx% on gross revenues
5 Bengaluru AISATS Airport Service Pvt. Ltd xx
Globe Ground xx
6 Hyderabad AISATS Airport Service Pvt. Ltd xx% on revenue earned from international sector
Menzies Bobba Ground Handling Services Pvt. Ltd.
xx% on revenue earned from international sector
Source: CAPA Research, AERA, Company filings
Note: n/a ‐ Not available
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The estimated manpower cost per process at the six metro airports is presented in Tables 13 and 14.
These are aggregated costs and vary by metro, depending on minimum wage requirements, cost of
living, and market forces in each metro. Manpower allocation varies largely depending on the type
of operation (domestic or international).
Table 13: Average manpower costs for metro airports by process*
Domestic flights, FY13 (USD/day)
Airport Cabin cleaning Ramp Passenger processing
Delhi x xx xx
Mumbai x xx xx
Kolkata x xx xx
Hyderabad x xx xx
Bengaluru x xx xx
Chennai x xx xx
Source: CAPA Research, *costs have been averaged out across airlines
Table 14: Average manpower costs for metro airports by process*
International flights, FY13 (USD/day)
Airport Cabin cleaning Ramp Passenger processing
Delhi x xx xx
Mumbai x xx xx
Kolkata x xx xx
Hyderabad x xx xx
Bengaluru x xx xx
Chennai x xx xx
Source: CAPA Research, *costs have been averaged out across airlines
Asset costs
Asset costs for various processes are largely the same across airports and do not vary by geography.
These costs are largely driven by the nature of the equipment and vary by the type of aircraft. CAPA
has developed estimates for asset costs for both hub as well as spoke stations, based on exhaustive
research and primary research, and these are presented in Tables 15 and 16.
These estimates reflect the costs of new assets, as required under the policy. However, it has in the
past been common to see a large secondary market for the purchase of equipment. Actual costs may
vary depending on volume purchases, depreciated values, negotiating power, and the useful life of
the equipment.
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Table 15: Minimum equipment required for narrow body flights at a spoke station and indicative costs, FY13
S.No. Equipment Number(s) required Unit cost (USD)
1 Aircraft wheel chocks 1 xx – xx
2 Baggage dollies 4 xx – xx
3 Crew coach 1 xx – xx
4 Diesel tractor 2 xx – xx
5 Ground power unit 1 xx – xx
6 Marshalling torch pads 2 xx – xx
7 Motorised conveyor belt 2 xx – xx
8 Motorised passenger stairs 1 xx – xx
9 Passenger coach 1 xx – xx
10 Push back (narrow body) 1 xx – xx
11 Tow bars (Code C) 1 xx – xx
12 Towable conveyor/belt loader 2 xx – xx
13 Towable step ladder(A320) 1 xx – xx
14 Wheel chairs 2 xx – xx
15 Cones 6 xx – xx
Source: CAPA Research
Table 16: Minimum equipment required for narrow body flights at a hub airport and indicative costs, FY13
Equipment Number(s) required Unit cost (USD)
Air conditioning unit (65 tonnes) 1 xx – xx
Air start unit 1 xx – xx
Aircraft wheel chocks 4 xx – xx
Baggage dollies 4 xx – xx
Crew coach 1 xx – xx
Diesel tractor 2 xx – xx
Ground power unit 1 xx – xx
Marshalling torch pads 1 xx – xx
Motorised conveyor belt 2 xx – xx
Motorised passenger stairs 2 xx – xx
Passenger coach 2 xx – xx
Push back (narrow body) 1 xx – xx
Toilet cart 1 xx – xx
Tow bars (Code C) 1 xx – xx
Towable conveyor/belt loader 2 xx – xx
Towable step ladder (A320) 1 xx – xx
Water cart 1 xx – xx
Wheel chairs 4 xx – xx
Cones 4 xx – xx
Fuel ‐ Variable
Insurance ‐ xx% ‐ xx% of asset value
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Delhi Airport air traffic movements by aircraft type: International departures
by Indian carriers
Aircraft Type Departures ‐ FY13
737‐800 winglets pax/BBJ2 2,859
A320 2,635
777‐300ER passenger 2,086
A319 1,521
A330‐200 1,175
737 passenger 1,076
777‐200LR passenger 947
A321 921
737‐800 passenger 337
787‐800 261
737‐900 passenger 191
A330‐300 38
A330 10
Grand Total 14,057 Source: CAPA, Airport IS
Delhi Airport air traffic movements by aircraft type: International departures
by foreign carriers
Aircraft Type Departures ‐ FY13
A330‐300 2,543
A320 2,376
777‐200/200ER Passenger 1,541
A330‐200 1,334
777‐300 passenger 963
767‐300 passenger 892
777 passenger 879
737‐800 passenger 770
A330 658
747‐400 passenger 533
A340‐600 510
A319 504
757‐200 passenger 501
777‐200LR passenger 487
A321 457
A310 391
767 passenger 365
767‐200 passenger 309
737‐300 261
A340‐300 251
747‐8 passenger 233
777‐300ER passenger 227
MD‐82 192
747 passenger 154
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MD‐11 passenger 137
A340 97
MD‐83 63
787‐800 62
737‐500 44
757 passenger 43
787 41
737‐700 winglets pax/BBJ1 32
737‐200 19
A300‐600 passenger 19
B727 passenger 15
757‐200 winglets passenger 8
737‐700 passenger 2
767‐400 passenger 2
A340‐500 2
E‐190 2
737 passenger 1
Grand Total 17,920 Source: CAPA, Airport IS
Ground handling costs per Departure: LCCs
As per CAPA estimates derived from a proprietary model and extensive primary research, handling
costs for low cost carriers on a per departure basis out of Delhi are estimated as below:
Airline Aircraft Cost per departure (INR)
IndiGo A320 xxx ‐ xxx
SpiceJet 737 xxx – xxx
SpiceJet Q400 xxx – xxx
GoAir A320 xxx ‐ xxx
Source: CAPA research Note: all asset costs are capitalised and based on the assumption that investment is made in the minimum equipment required to service the current volume of departures. As the headquarters for SpiceJet and IndiGo, the costs at Delhi also include an allocation for management and training costs.
Ground handling costs per Departure: FSCs
Estimated handling costs per departure for full service carriers are as below:
Airline A/C Cost per departure (INR)
Air India Narrow body (dom) xxx ‐ xxx
Wide body (Intl.) xxx – xxx
Jet Narrow body (dom) xxx – xxx
Wide body (Intl.) xxx ‐ xxx
Source: CAPA research Note: all asset costs are capitalised and based on the assumption that investment is made in the minimum equipment required to service the current volume of departures. For Air India this includes management and training costs; numbers for Jet include regional aircraft but exclude JetKonnect.
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Number of outsourced employees
According to CAPA Research findings — based on extensive engagement with key stakeholders —
the level of outsourcing of manpower for domestic operations is lower than that for international
operations for both cabin cleaning and ramp handling. Table 18 presents the number of outsourced
employees per departure for these two activities.
Table 18: Number of outsourced staff per departure by activity
Cabin cleaning* Ramp**
Domestic operations x – x xx ‐ xx
International operations xx ‐ xx xx ‐ xx
Source: CAPA Research, company filings
*Cabin cleaning figure includes lavatory and potable water services
**Ramp figure includes manpower for baggage transportation, sorting, and airside loading/unloading
Table 19 presents CAPA estimates for the number of outsourced employees at the top 10 Indian
airports. We developed these numbers on the basis of our proprietary model of labour requirements
by activity supported by on‐the‐ground industry inputs.
Table 19: Number of outsourced ground handling staff at top 10 airports
Airport Number of outsourced employees
Delhi xxxx ‐ xxxx
Mumbai xxxx ‐ xxxx
Bengaluru xxxx ‐ xxxx
Chennai xxxx ‐ xxxx
Hyderabad xxxx ‐ xxxx
Kolkata xxxx ‐ xxxx
Cochin xxxx ‐ xxxx
Ahmedabad xxxx ‐ xxxx
Pune xxxx ‐ xxxx
Goa xxxx ‐ xxxx
Source: CAPA research
These outsourced employees are over and above those on the direct payrolls of the ground handling
firms. If the final policy ruling prohibits subcontracting as the government is seeking to achieve,
these staff will have to be employed directly by the authorised ground handling firms.
This will drive up overall labour costs because most of the subcontracted labour is currently
employed on the basis of daily wages (often below the minimum rate), with no tenure and few if any
additional benefits such as leave, provident fund and medical.
Formalising their employment on terms compliant with statutory regulations and providing a safe
working environment will result in increased costs. Handling firms will need to further invest in
training these staff to increase their productivity to mitigate the increased expenses.
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Currently, the volume of manpower outsourced by the five private domestic airlines is greater than
the number of handling‐related employees that they employ directly. Figure 20 provides the number
of on‐roll and outsourced staff engaged in handling activities for the five Indian airlines at the six
metro airports.
Figure 20:Employment status of staff engaged in handling activities for the five Indian carriers at the six metro airports, FY11
Source: CAPA, High Court filing
Employee strength of ground handling firms
In FY12, eight ground handling firms—Air India, Cambata, Çelebi NAS, Bird Worldwide Flight Services
(BWFS), Bhadra International, Globe Ground, Çelebi and Indo Thai — handled the majority of aircraft
departures at Indian airports. These ground handling firms employed close to 25,000 staff. They also
make some use of subcontracting agencies however in the case of the authorised ground handlers
this represents less than 5% of their total staff deployment.
Table 20: Number of employees with designated GH firms
Company Employee strength (FY12)
Air India Limited 10,481
Bhadra International India Ltd. 1,396
Bird Worldwide Flight Services 1,979
Cambata Aviation Pvt. Ltd 7,000
Çelebi Ground Handling Delhi Pvt. Ltd. 678
Çelebi–NAS Airport Services India Pvt. Ltd. 2,125
Globe Ground India 1,017
Indo–Thai Airport Management Services Pvt. Ltd 93
Total 24,769
Source: CAPA Research, Company filings, AERA
Note: numbers may include outsourced manpower
9,744 (61%)
6,210 (39%)Outsourced
On payroll
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Major subcontractors at metro airports
Outsourced manpower is usually provided by subcontractors (defined as firms providing manpower
or GSE services to designated ground handlers or airlines that are self‐handling). There are several
subcontractors present throughout the country and it is a largely unstructured and unorganised
market. Major subcontractors for the six metro airports are listed in Table 21.
Table 21: Major subcontractors at metro airports
Station Supplier Services
Delhi Lion Manpower Solutions Pvt. Ltd. Manpower supplier
Neha Aviation Services GSE provider, manpower supplier
Aroon Aviation Services GSE provider, manpower supplier
Sunshine Enterprises Manpower supplier
Agarwal Packers and Movers Manpower supplier
JAC Air Services Manpower supplier
Livewel Aviation Aircraft cleaning services
Hyderabad Turbo Aviation GSE provider, manpower supplier
Taurus Aviation GSE provider, manpower supplier
Visskan Aviation GSE provider, manpower supplier
Mumbai Airawat Aviation Services GSE provider, manpower supplier
Steader International GSE provider, manpower supplier
Krystal Aviation GSE provider, manpower supplier, catering services
Livewel Aviation GSE provider, manpower supplier
Bengaluru Visskan Aviation GSE provider, manpower supplier
Décor Drapes Aviation Services Pvt. Ltd./Décor Aviation Pvt. Ltd
GSE provider, manpower supplier
Bengaluru Airport Terminal Services Cabin cleaning services, ground handling
Kolkata JP Aviation Services Manpower supplier
Able Aviation Manpower supplier, handling services
Jai Santoshi Maa Manpower supplier
Ideal Cleaning Cabin cleaning
Transtrack Services Manpower supplier
Star Aviation Services GSE provider, manpower supplier
Chennai Universal Aviation Services GSE provider, manpower supplier
Kazi Aviation GSE provider, manpower supplier
Krystal Aviation Services Manpower supplier
Santham Contractors Manpower supplier
Source: CAPA Research
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Financial analysis – Çelebi Ground Handling Delhi Pvt. Ltd.
Key financial results (USD million)
FY12* FY11* FY10
Total income 5.84 1.7 n/a The ground handling
business is marked by
high operating
leverage, as the
majority of costs are
fixed.
Consequently, Çelebi
Ground Handling
being in its second
year of operations
reported a loss of
USD3.26 million in
FY12.
Çelebi has been
aggressively pursuing
new clients for
growth in a price‐
sensitive market,
which is evident in its
growing revenues but
declining net profit.
The company’s
current ratio fell in
FY11 and FY12. This
can be attributed to
the loans it took for
expansion in FY11
and the increase in
interest payments
due to the
subsequent
depreciation of the
Rupee.
Total expenditure 4.90 (5.1) n/a
Interest 1.63 n/a n/a
Profit/(loss) before tax (3.26) (3.5) n/a
Provision for income tax 0.00 0.0 n/a
Net income (3.26) (3.5) n/a
Shareholders' equity 8.89 12.0 11.2
Debt 12.76 11.1 0.0
Total liabilities 13.13 23.1 11.2
Gross fixed assets 11.57 11.3 0.0
Depreciation 1.68 1.2 0.0
Net fixed assets 9.89 10.2 0.0
Current assets 2.46 10.2 11.1
Current liabilities 2.19 1.2 0.3
Net current assets 0.28 9.0 10.8
Other assets 0.50 0.1 0.0
Profit and loss account n/a 3.8 0.3
Total assets 23.15 23.1 23.1
Key ratios
FY12 FY11 FY10*
Profitability
EBIT/operating income (55.73)% 204.2% n/a
PAT/operating income (55.73)% 203.7% n/a
ROCE (15.53)% (14.9)% n/a
Solvency
Interest coverage n/a n/a n/a
Debt‐to‐equity ratio 1.44 0.9 0.0
Liquidity
Current ratio 1.13 8.5 38.9
Source: CAPA Research, MCA,* some numbers are CAPA estimates and do not represent actuals.
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Rating agency inputs for Çelebi Ground Handling Delhi Pvt. Ltd.
Rating assigned to various bank facilities Facilities Amount (INR mn) Current Rating Previous Rating
Long‐term bank facilities 750 CRISIL BB (reaffirmed) CRISIL BB
Short‐term bank facilities 600 CRISIL A4 (reaffirmed) CRISIL A4
Total 1350
Source: CAPA Research, CRISIL, as of Feb 11, 2013
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Capex plans by ground handling firms at
selected airports Sr. No. Airports Ground Handler Capex Projections (INR Million)
FY13 FY14 FY15
1 Delhi BWFS x.x x.x x.x
Cambata x.x x.x x.x
Çelebi x.x x.x x.x
2 Mumbai Cambata x.x x.x x.x
Çelebi‐NAS x.x x.x x.x
3 Bengaluru GlobeGround x.x x.x x.x
4 Hyderabad Menzies Bobba x.x x.x x.x
5 Cochin BWFS x.x x.x x.x
6 Ahmedabad Cambata x.x x.x x.x
Source: CAPA Research, industry sources, AERA
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Airport Ground handlers
Varanasi Air India NAS Indo Thai
Nagpur Air India NAS
Amritsar Air India Indo Thai
Srinagar Air India Indo Thai
Guwahati Air India Rudra Aviation
Source: CAPA Research
Findings of CAPA survey on ground handling operations in India
Policy and regulations
The ground handling policy was partially implemented at the metro airports, with airport operators
selecting third party ground handlers through an international competitive bidding process. The
policy proposed the exit of subcontractor handling firms.
Subcontracting plays a major role in the Indian ground handling industry. These subcontractors
provide either manpower. However, most of these companies are very small in size, with presence
at only one or two airports.
The directive to end subcontracting has not been implemented and remains sub judice. Most PPP
airport operators were of the view that the policy should be fully implemented with some
modification. Table 27 collates the views of airport operators on the ground handling policy.
Table 27: Views of airport operators on the ground handling policy
Impact category Key impact Remarks
Infrastructure impact
Improved equipment utilisation
Limiting the number of ground handling operators would improve equipment utilisation.
Improved standard of equipment
The proposed policy allows ground handling firms to achieve scale in their operations by:
limiting the number of licensed
ground handling firms at the airport
and;
prohibiting subcontracting of GH
activities.
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This should in turn justify the induction of more expensive IATA‐standard ground handling equipment.
Labour laws Improved compliance with labour laws
According to several airport operators, subcontractors commonly violate labour laws by not paying benefits or for that matter the minimum wage in order to support a low cost base. However, the licensed ground handlers are believed to comply with statutory requirements.
Human Resource Impact
Improved quality of workforce
Subcontractors usually provide untrained and unskilled labour for ground handling activities. The move to licensed handlers is expected to result in greater investment in training and the development of a higher quality labour force.
Reduced attrition Subcontractors usually deploy temporary labour and do not follow standard HR policies with respect to tenure. With the implementation of the proposed policy, only permanent workers will be permitted in ground handling activities. Employees will benefit from enhanced working terms and conditions which in turn should lower the attrition rates.
Increased staff utilisation With airlines forced to use one of the designated handlers at an airport rather than self‐handling this should result in more efficient deployment of staff as resources can be shared across carriers.
Safety and security impact
Enhanced safety Only trained staff will be allowed to operate equipment. Licensed handlers are expected to have a greater focus on occupational health and safety than the current subcontractors.
Enhanced security The greater deployment of permanent staff, employed by a handful of licensed, professional companies should improve the ability to monitor personnel for security purposes. The current multiplicity of companies employing itinerant and unskilled workers for airside roles is unmanageable.
Source: CAPA Research
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Table 30: Proposed and approved comprehensive tariffs for ground handling of scheduled passenger aircraft by AISATS
Domestic (INR) International (INR)
Aircraft type Proposed charges Charges approved by AERA
Proposed charges Charges approved by AERA
Code B 14,351 12,700 63,054 55,700
Code C 12,204 10,800 105,316 93,200
Code D 19,323 17,100 173,003 153,100
Code E 64,410 57,000 203,287 180,000
Code F 114,582 101,300 282,630 251,000
Source: CAPA Research, AERA
Mumbai airport
In FY14, the following three ground handling firms were operating at Mumbai airport:
Air India Limited
Cambata Aviation Pvt. Ltd.
Çelebi NAS Airport Service Pvt. Ltd.
Table 31 below provides AERA‐approved tariffs for scheduled passenger aircraft serviced by Çelebi
NAS during FY14 at the airport.
Table 31: Comprehensive tariffs for ground handling of scheduled passenger aircraft
Domestic (INR) International (INR)
Aircraft type Pax terminal services
Ramp handling
Total Pax terminal services
Ramp handling
Total
Code B 3,800 8,900 12,700 11,000 33,000 44,000
Code C 3,200 7,600 10,800 23,500 69,900 93,400
Code D 4,500 12,700 17,200 30,400 1,23,000 1,53,400
Code E 19,100 38,100 57,200 35,600 1,44,700 1,80,300
Code F 38,100 63,500 1,01,600 55,000 1,97,000 2,52,000
Source: CAPA Research, AERA Note: Ceiling rates are as per the concession agreement with Mumbai International Airport Pvt. Ltd., dated 14 November 2008. These rates are exclusive of government taxes and duties such as service tax and the concession fee payable to the airport operator.
The approved FY13 tariffs for ground handling services provided by Cambata Aviation at the airport
for scheduled passenger aircraft are provided below.
Aircraft type International (INR)
A320 123,200
737 134,400
A330 196,000
A340 151,200
747 173,600
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747‐200 209,440
747SP 173,600
767 176,400
777 154,000
A330‐600 173,600
Source: CAPA Research, AERA Note: Tariffs provided in the table are inclusive of royalties payable to the airport operator.
Air India also provides ground handling services at Mumbai airport. It has submitted its tariff
proposal to AERA and the proposed rates are provided in Table 32. In its proposal, Air India has
proposed to retain existing tariffs for ground handling services for the entire control period. In
addition, it has stated that in case of any revision it will approach AERA. As Air India has not
proposed any increase in ground handling charges, AERA is currently considering this submission of
AI for determination of tariffs for ground handling services provided by it at Mumbai airport.
Table 32: Proposed tariffs for ground handling of scheduled passenger aircraft by Air India
Aircraft type Transit Turnaround within 4 hours
Turnaround beyond 4 hours
A320/737 1,310 1,799 2,008
707/IL62/757 1,455 1,999 2,231
A330/A310/767/A330 2,882 3,914 4,432
747/A340/777 3,413 4,665 5,279
Source: CAPA Research, AERA Note: Numbers are in USD. For conversion of USD into INR, RBI reference rate as on the first day of the month for the first fortnightly billing period and the rate prevailing as on sixteenth day of the month for the next fortnightly billing period shall be adopted. Airport levy and service tax will be charged additionally Time Iimit for use of equipment per flight is as follows: ‐2 hours for transit flights ‐2 hours 30 minutes for turnaround within 4 hours ‐3 hours for turnaround beyond 4 hours Flights handled between 0001 Hours and 0400 Hours will be charged a 15% peak‐hour surcharge. Handling in case of technical landing for other than commercial purpose will be charged 50% of the above rates, provided there is no physical change of load. Handling in case of return to ramp will not be charged extra, provided that a physical change of load is not involved. Handling in case of return to ramp involving a physical change of load will be charged as for handling in case of a technical landing No extra charge will be implemented for providing the services on Saturdays, Sundays, and public holidays.
Chennai airport
During FY14, the following three ground handling firms provided ground handling services at
Chennai airport.
Air India
Bhadra International India Ltd.
Cambata Aviation Pvt. Ltd.
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Appendix E: Minimum and average wage rates of personnel
employed in ground handling
Minimum wage rates for ground handling staff across six metros (in USD)
City Classification of Labour Skill
Skilled Semi‐skilled Unskilled
Delhi x.xx x.xx x.xx
Mumbai x.xx x.xx x.xx
Bengaluru x.xx x.xx x.xx
Chennai x.xx x.xx x.xx
Hyderabad x.xx x.xx x.xx
Kolkata x.xx x.xx x.xx
Source: CAPA Research, numbers are in USD/hour
Average wage rates for ground handling staff across six metros (in USD)
Role Bengaluru Chennai Delhi Hyderabad Kolkata Mumbai
Airside Salary/month Salary/month Salary/month Salary/month Salary/month Salary/month
Cabin cleaning
Supervisor xxx xxx xxx xxx xxx xxx
Staff xxx xxx xxx xxx xxx xxx
Ramp
Supervisor xxx xxx xxx xxx xxx xxx
Staff xxx xxx xxx xxx xxx xxx
Bus Drivers xxx xxx xxx xxx xxx xxx
Baggage drivers xxx xxx xxx xxx xxx xxx
Jetway operator xxx xxx xxx xxx xxx xxx
Marshals xxx xxx xxx xxx xxx xxx
Terminal
Gate agents
Supervisor xxx xxx xxx xxx xxx xxx
Staff xxx xxx xxx xxx xxx xxx
Porter xxx xxx xxx xxx xxx xxx
Source: CAPA Research, numbers are in USD/month and only include the cash component of salary (i.e. benefits are excluded)
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Appendix J: Financial Analysis of ground/cargo handling firms at
Kolkata airport
Able Aviation India Pvt. Ltd.
Balance sheet (Units in USD mn.) Y‐o‐Y Change
FY10 FY09 FY08 FY10 FY09
Sources of funds
Paid up capital 0.185 0.185 0.019 0.0% 900.0%
Share application money (pending allotment) 0.000 0.000 0.000 0.0% 0.0%
Reserves and surplus 0.023 0.017 0.006 37.5% 206.5%
Secured Loans 0.013 0.018 0.028 ‐27.1% ‐37.1%
Unsecured Loans 0.000 0.000 0.076
Deferred Tax Liabilities (Net) 0.000 0.000 0.000
Total liabilities and equity 0.221 0.220 0.128 0.7% 71.2%
Application of funds 0.000 0.000 0.000
Gross fixed assets (including intangible assets) 0.220 0.201 0.111 9.3% 80.7%
Less: depreciation and amortisation 0.066 0.038 0.009 75.8% 299.9%
Net Fixed Assets 0.153 0.163 0.102 ‐6.0% 60.4%
Capital work‐in‐progress 0.000 0.000 0.000
Investment 0.000 0.000 0.000
Deferred tax assets (Net) 0.000 0.000 0.000
Current assets, loans and advances 0.000 0.000 0.000
(a) Inventories 0.000 0.000 0.000
(b) Sundry Debtors 0.239 0.209 0.069 14.6% 202.7%
(c)Cash and Bank Balances 0.007 0.027 0.005 ‐72.5% 398.5%
(d) Other current assets 0.000 0.000 0.000
(e) Loans and Advances 0.021 0.010 0.003 121.2% 202.8%
Less : Current Liabilities & provisions 0.000 0.000 0.000
(a) Current Liabilities 0.201 0.189 0.052 5.9% 266.9%
(b) Provisions 0.000 0.000 0.000
Net Current Assets 0.068 0.056 0.026 20.6% 115.7%
Misc expenditure to the extent not written off or adjusted
0.000 0.001 0.001 ‐33.3% ‐25.0%
Profit & Loss Account‐ Dr. Balance 0.000 0.000 0.000
Total Assets 0.221 0.220 0.128 0.7% 71.2%
Source: MCA filings, CAPA research
Ratio Analysis FY10 FY09 FY08
Net Debt/Equity Ratio 2.7% ‐4.4% 412.5%
Current Ratio 1.34 1.30 1.50
Quick Ratio 1.23 1.24 1.44
Debt to Total Assets Ratio 0.06 0.08 0.81
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Appendix P: Ground support equipment with select designated
ground handling firms at Indian airports
Çelebi Delhi Ground Handling –Delhi Airport
Ground Support Equipment Quantity
Air Start Unit xx
Air Conditioning Unit xx
AmbuLift xx
Baggage Trolley xx
Container Dolly xx
Conveyor xx
Fork Lift xx
Ground Power Unit xx
Loader xx
Pallet Dolly xx
Push Back xx
Roller n/a
Step Ladder xx
Toilet Cart xx
Tow Bar xx
Tow Tractor n/a
Tractor xx
Water Cart xx
Total xxx
Source: CAPA Research, AERA