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Business trends

India airline profits wiped out by price war

Soaring fuel costs and weak rupee cause turbulence despite market growth

Earnings deteriorated at IndiGo, which commands a roughly 40% market share. (Photo by Akira Hayakawa)
Earnings deteriorated at IndiGo, which commands a roughly 40% market share. (Photo by Akira Hayakawa)

MUMBAI -- Profits at Indian air carriers are fast losing altitude despite robust demand growth as the companies battle surging fuel costs and a depreciating local currency in a crowded market.

IndiGo, the biggest private-sector carrier in India, enjoyed a strong year in the 12 months ended March 31, with after-tax parent-only profit growing 35% on the year to 22.4 billion rupees ($321 million). Praised for its on-time performance, IndiGo controls 40% of the domestic passenger market.

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