Air India Express raises borrowing limit to ₹17,500 crore amid losses, turbulence

Air India Express increases borrowing limit by 25 percent ₹17,500 crore to fund short-term and future financial operations, marking the third increase since AirAsia India’s merger in 2024 and underscoring continued turbulence at Tata Group’s low-cost carrier.

The move signals deepening financial trouble at the low-budget airline, where losses have risen sharply while revenues have increased. With rising crude oil prices and the closure of West Asian airspaces disrupting operations, the high debt ceiling gives the airline breathing room to manage cash flows; but it also highlights the growing pressure on the Tata Group’s aviation bets.

“In order to manage the 4th Quarter (January-March 2026) cash flows and support the annual operating plan, it is proposed to increase the general borrowing limits as follows: ₹3,500 crore, said a special resolution passed by Air India Express shareholders in a meeting held on February 24 and submitted to the corporate affairs ministry on March 20.

Under the Companies Act 2013, a special resolution requires approval by at least 75% of the votes cast by shareholders.

GS Bawa, general secretary of consumer rights group Air Travelers Association (ATA), said, “The airline has increased its borrowing limits and perhaps it is an indication that it wants to expand. The conflict in the Middle East has seriously affected its operations and profitability. Perhaps it will try to increase its domestic operations or try to tap more into the Indian market, especially smaller city to larger city routes, and make provisions for funds accordingly. It is also not necessary for them to use the entire borrowing limit, it can just be an enabling provision.”

Air India Express did not respond Mint‘s queries.

Air India Express, a wholly owned subsidiary of Air India, was the first to exceed its borrowing limit. ₹11,600 crore in October 2024, followed by further increase ₹14,000 crore in November 2024.

Debt and losses are increasing

The airline ended March 2025 as follows: ₹10,087.4 crore debt (excluding lease liabilities). With the revised ceiling ₹17,500 crore — a figure that will exceed this figure ₹16,033 crore revenue was generated last year.

Revenues increased by 26 percent annually ₹16,033 crore in FY25. But losses have more than quadrupled ₹5,822 crore.

Debt (excluding lease obligations) increased by 61% ₹6,261.7 crore a year ago ₹10,087.4 crore.

Simply put, Air India Express lost ₹36 each ₹100 income.

In comparison, parent Air India’s revenue rose 13% ₹61,080 crore in FY25. Cut losses under CEO Campbell Wilson ₹3,976 crore ₹5,031 crore a year ago — roughly representing a loss ₹6.5 for each ₹100 won.

Air India’s standalone liabilities (excluding lease liabilities) ₹29,713 crore, down over 8% in FY25 ₹32,465 crore in FY24, according to filings with the ministry of corporate affairs.

Air India Express currently has a fleet of 105 aircraft, according to a company official. The airline expects to add 20-24 narrow-body aircraft this year, the official said.

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Air India’s standalone losses were: ₹3,976 crore while standalone losses of Air India Express ₹5,822 crore, total losses of two airlines ₹9,798 crore.

The third company, AI Fleet Services, which carries out aircraft financing and foreign currency borrowing transactions, reported a loss. ₹442 crore. Two joint ventures (Air India SATS Airport Services and Airbus India Training Center) have reported profits so far: ₹510 crore.

After subtracting intercompany revenue and profits, Air India Group’s consolidated profit totaled ₹10,859 crore last year.

Tata Group’s aviation business continues to hemorrhage cash as parent company Tata Sons spends ₹45,347 crore ($5.1 billion) so far.

The group also invested around $4.7 billion to build its e-commerce businesses (BigBasket, Tata 1mg, Croma and Cliq), which continue to be loss-making.

Concerns over the lack of a clear profitability roadmap for Tata Group’s $14 billion semiconductor investment, as well as some new ventures, prompted Tata Trusts chairman Noel Tata to raise the issue at last month’s Tata Sons board meeting. This led to a postponement of the decision to give Tata Sons chairman N. Chandrasekaran a new five-year term.

Tata Trusts owns 65.9% of Tata Sons, the holding company of the Tata Group.

Leadership and competition

The airline has appointed Captain Hamish Maxwell as director and key management personnel for a one-year term after managing director Aloke Singh resigned earlier this month.

Maxwell, who previously worked for Singapore Airlines and Vistara. ₹9.5 crore, according to statements.

Air India Express competes with IndiGo in domestic operations and also flies to West Asia and Southeast Asia.

IndiGo on Monday appointed Singh as chief strategy officer, marking the first leadership change at the country’s largest airline since founder Rahul Bhatia took over as interim chief executive following the resignation of Pieter Elbers.