{"id":2308,"date":"2020-12-18T18:11:00","date_gmt":"2020-12-18T18:11:00","guid":{"rendered":""},"modified":"2025-11-07T13:04:02","modified_gmt":"2025-11-07T07:34:02","slug":"airline-stocks-factoring-in-too-much-optimism","status":"publish","type":"post","link":"https:\/\/www.equentis.com\/blog\/airline-stocks-factoring-in-too-much-optimism\/","title":{"rendered":"Are Luggage, Hotel & Airline Stocks Factoring in Too Much Optimism? – Research & Ranking"},"content":{"rendered":"
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It\u2019s lovely December!! It\u2019s that time of the year when people pack their backs and leave for vacations within and outside India. The weather is comfortable in most parts of India, kids have vacations, people are looking at extinguishing their mandatory leaves and there is a scramble for hotels, trains and planes.<\/p>\n

Wake up!! This isn\u2019t 2019\u2026\u2026.<\/strong><\/h2>\n

Jump to 2020\u2026\u2026\u2026..Hardly any of this is happening. The COVID\u201919 pandemic has forced hoteliers to keep their properties shut or operate at lower occupancies, trains and planes aren\u2019t operating at full capacity and people are looking for safer options for holidaying. Needless to say, business travelers have become an extremely rare species.<\/p>\n

The revenue carnage\u2026\u2026<\/strong><\/h3>\n

Revenue decline for players in both quarters of FY21 was between 52% and 92%. This is a scary number and is nothing short of a whitewash.<\/p>\n

Revenue decline for key players <\/strong>(decline expressed with positive sign)<\/em><\/h3>\n

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Source:<\/strong><\/u> ACE Equity, Company data. Note<\/strong><\/u>: We have taken top 5 hotel players by Market Cap, 2 airline stocks and the only 2 listed luggage companies for comparison.<\/em><\/p>\n

\u2026..painted the charts red with losses<\/strong><\/h3>\n

If revenue decline looks scary then quarterly losses are even scarier.<\/p>\n

Quarterly losses of hotel and luggage companies (Rs. Mn.) — <\/strong>losses expressed with positive sign<\/em><\/h3>\n

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Quarterly losses of airline companies (Rs. Mn.) — <\/strong>losses expressed with positive sign<\/em><\/h3>\n

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Source:-<\/strong><\/u> ACE Equity, Company Data<\/em><\/p>\n

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We all know the reasons, but still\u2026\u2026\u2026\u2026.<\/strong><\/h3>\n

It\u2019s not difficult to understand why this whole carnage happened. Short answer is \u201cCOVID\u201919 pandemic<\/em>\u201d. Let us examine the reasons.<\/p>\n