Air India Express likely to post first profit since privatisation, rises to second amongst domestic airlines

Air India Express has posted an operating profit for the first time since Air India was privatised in January 2022, marking a key financial milestone for the Tata Group-owned carrier. The airline is projected to report an operating profit in the second half of FY26 (H2 FY26), driven by tighter cost controls, improving unit economics and stronger operational performance.

The development was shared with employees during a recent town hall at the airline’s Gurugram headquarters, attended by Chairman Nipun Aggarwal and Managing Director Aloke Singh. Management said the turnaround reflects the impact of a focused commercial strategy, sharper capacity deployment and an enhanced customer proposition, despite continued challenges in the aviation sector.

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According to the airline, sustained financial discipline, alongside investments in fleet, systems and people, has helped build a more scalable and resilient business. While achieving operating profitability is a significant step, the management stressed that the long-term focus remains on improving margins, maintaining dependable service and sustaining performance.

Rapid growth since privatisation

Air India Express has expanded rapidly since privatisation, with available seat kilometres (ASKs) nearly doubling and market share tripling. The airline is planning exponential growth of nearly three times by FY31, when it aims to operate a fleet of around 300 aircraft and command a 25% market share in the domestic market.

As of now, the airline has emerged as the second-largest domestic airline in India after IndiGo, in terms of network footprint. Air India Express operates 110 domestic routes, compared with 70 for Air India, and serves 45 domestic stations. Internationally, it flies 75 routes across 60 stations.

The airline’s network is almost evenly split between international and domestic operations, with a 54:46 ratio, in contrast to IndiGo’s predominantly domestic skew of 70:30.

Value-carrier strategy and customer focus

Positioning itself as a value carrier rather than a traditional full-service or low-cost airline, Air India Express is targeting a premium yet differentiated experience. As part of this strategy, the airline is investing over $70 million in a retrofit programme to upgrade its product offering.

With improving financials, expanding domestic dominance and ambitious growth plans, Air India Express is fast positioning itself as a key force in India’s aviation market, reinforcing its role within the broader Air India Group transformation.