The Indian aviation sector is undergoing a turmoil resulting from the global meltdown leading to a subsequent decline in traffic and rise in costs. However, airport infrastructure development (AID) should be given priority by the developers offering enough retail spaces to cash in huge revenue as the domestic and global retailers are now investing more on the segment, according to a KPMG report.
Meanwhile, the study has an optimistic outlook towards the future of airport retail as well. The key findings of the study suggest that the takers for airport retail are spread across industries and service providers. The food and beverages players have showed the maximum interest in creating a presence in airports, and are closely followed by fashion houses and consumer durable players. Most international luxury brands consider setting up shop in Indian airports a definite part of their global strategy.
Speaking on the report release, Rajeev B Batra, executive director, KPMG, said, “Airports in India are a future potential area not just from an aviation perspective but also from a real estate point of view. While this might be a new phenomenon in India, globally, airports have embraced the concept of developing the surrounding commercial areas.”
He added, “In an aerotropolis, a significant component of the revenue comes from non-aeronautical components, which are known to yield faster returns compared to the aeronautical components which is helpful for financial standing of the airport developers.”
Meanwhile, the KPMG report titled ‘Indian Airports – Global Landing Ground’ has tried to map the journey of airport development by analysing the role played by its key stakeholders, the challenges faced at a micro and macro level and the opportunities present in the current landscape, said an official press release.