Air India, India’s pioneering airline, has been intricately woven into the fabric of the nation’s aviation history. From its inception in the pre-independence era to its recent journey of privatization, the airline has weathered numerous challenges and transformations.

In a significant turn of events, the Tata Group reacquired Air India in 2022, marking a pivotal shift in the airline’s ownership structure. This move signalled the Indian government’s decision to transfer control of the debt-laden carrier to private hands, with the aim of revitalizing its operations and restoring its former glory. With the ‘Maharaja’ returning to its original owners, it’s an opportune time for investors to explore the potential opportunities associated with the airline.

Air India Company History

Air India has been a prominent name in the aviation industry for several decades. The Maharaja was established in 1932 as Tata Airlines. It got its current name in 1946. Post-independence, in 1953, the government nationalised the airline. For years, the airline enjoyed a monopoly in the Indian skies, connecting the vast nation and serving as its international ambassador.

However, the advent of liberalisation in the 1990s ushered in private airlines, intensifying competition. Financial troubles started mounting for Air India, leading to a burgeoning debt crisis. Despite numerous bailout attempts, the situation worsened, pushing the government towards privatisation. The government eventually sold the airline in 2022, marking a new chapter in the airline’s history.

Air India Share Price and How to Buy

Air India is not a listed entity on the Indian stock market, so it will not be possible for you to invest in Air India shares or check the Air India share price. While the Tata Group has several listed stocks such as Tata Motors, Tata Steel, Tata Power, etc., Air India is not a part of that list. So, even your search for Tata Air India share price will draw a blank as it is not listed on the stock market.

Now, if you can’t invest in Air India shares, can you look to invest in its parent Tata Group’s stocks as an alternative? The answer to that would also be no, since the Tata Group is a massive conglomerate and has several business interests and listed stocks, and investing in any or all of them should not be considered as a like-for-like alternative for investing in Air India shares.

See Also: When Will Tata Power Share Price Go Up?

Air India Fundamentals

The privatisation was aimed to alleviate Air India’s financial woes, but the path to profitability remains steep. Before we get into the financials, here’s a look at the airline’s other key metrics. The company welcomed 1.04 crore passengers in FY22 as compared to 62 lakh in FY21. Total revenue hours flown in FY22 stood at 2.78 lakh as against 1.73 lakh.

Now, let’s dive into the company’s financials from the past three years.

Particulars	FY2022	FY2021	FY2020
Revenue	₹19,815.91	₹12,104.05	₹28,525.44
Expenses	₹26,643.42	₹19,083.33	₹36,290.17
Total Loss	₹9,591.56	₹7,083.91	₹7,982.82

As is clear from the table above, the company has been struggling, but with the new management in place, it is hopeful of a turnaround.

Air India Revival Plans And Action

When the Tata Group assumed control of Air India, they inherited a fleet of aircraft that had been grounded due to maintenance issues stemming from financial constraints. However, with renewed investment and strategic planning, the group began the process of revitalizing the airline’s operations.

The initial focus was on restoring service to previous destinations, gradually increasing flight frequency, and even introducing new routes, such as the Mumbai to Melbourne connection. Despite facing challenges with outdated equipment and supply chain disruptions, the Tata Group leveraged its resources to address maintenance issues creatively. This included utilizing 3D printing technology to replace traditional parts and overcome supply chain obstacles.

To enhance passenger experience and modernize its fleet, Air India announced a significant investment of US $400 million to refurbish the interiors of its widebody aircraft. This comprehensive refurbishment plan encompasses 43 aircraft, including 27 B787s and 16 B777s. The overhaul will involve installing new seats across all cabins, upgrading inflight entertainment systems, and introducing inflight Wi-Fi connectivity.

The refurbishment project is scheduled to commence in mid-2024, with completion expected by the end of 2025. This timeline suggests that refurbished aircraft will begin re-entering service in the second half of 2024. By March 2024, Air India anticipates upgrading 33% of its widebody fleet, including aircraft like the A350s and B77Ws acquired from other carriers.

Air India has also placed substantial aircraft orders from both Airbus and Boeing, totalling around $70 billion. This procurement included 470 aircraft, with Boeing accounting for 220 of them. The Boeing order comprised 190 Boeing 737MAX narrowbody planes, 20 Boeing 787 Dreamliners, and 10 Boeing 777X aircraft.

Furthermore, the Tata Group continued to strengthen its fleet by welcoming a new Airbus A320neo in October last year. Prior to this addition, in August, the group unveiled a refreshed corporate logo dubbed ‘The Vista’. The company has also unveiled a new dress code for its staff designed by celebrity fashion designer Manish Malhotra.

Factors Affecting Air India’s Performance

Several factors can impact Air India’s performance, including:

1. Industry Competition: The aviation industry is highly competitive, with various airlines vying for market share. Air India faces competition from both domestic and international carriers, and changes in the competitive landscape can influence its market position.
2. Government Policies and Regulations: The aviation industry is subject to various government policies and regulations that can impact operations, pricing, and profitability. Changes in regulations, taxation, and licensing requirements can affect Air India’s performance.
3. Fuel Prices and Operating Costs: Fluctuations in fuel prices and other operating costs can significantly impact an airline’s financial health. As a fuel-intensive industry, changes in oil prices can have a significant effect on Air India’s profitability.
4. Economic Factors: The overall economic conditions, such as GDP growth, inflation rates, and consumer spending, can influence the demand for air travel. Economic downturns or recessions can lead to reduced passenger traffic, affecting Air India’s revenues.

Alternative Investment Ideas:

Since investing in Air India shares is not feasible, you can look for alternative investment options within the aviation industry. Investors can consider other publicly listed airlines such as IndiGo and SpiceJet. While Indigo has shown steady growth things at Spicejet have not been so smooth.

The aviation industry has always been considered tough. Over the years, India has seen several airlines such as Kingfisher and Jet Airways shut shop. The latest addition to this list was Go First, which filed for bankruptcy in May 2023.

So, before you make any investment decisions make sure that you are not only well-versed with the company’s fundamentals but also have a wide overview of the industry.

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Editor's Note: Artificial intelligence was used as a secondary aid in the writing of this story.