AI Engineering Services Ltd (AIESL), a state-owned aircraft maintenance company, is strategizing to establish maintenance, repair, and overhaul (MRO) facilities at the upcoming Jewar airport and the recently inaugurated Navi Mumbai International Airport. This initiative aims to capitalize on the increasing demand from airlines for MRO services.
Chief Executive Sharad Agarwal indicated that AIESL is planning an investment ranging from ₹200 to ₹300 crore for these new facilities. This move comes as airlines, including Air India, IndiGo, and Akasa Air, are also developing their own MRO infrastructures, intensifying competition in the sector.
Investment and Expansion Plans
AIESL is considering a measured approach to its expansion. The company plans to allocate approximately ₹100-150 crore per hangar, primarily funded through internal resources. Agarwal noted that the completion of these projects is expected within two years after securing necessary approvals and land.
Market Context
The Indian MRO market, valued at $1.7 billion in 2021, is projected to exceed $4 billion by 2031. With over 1,000 aircraft on order, India is on track to become the third-largest buyer of commercial jets globally, necessitating around 200-300 major maintenance checks annually.
Current Operations and Future Goals
Currently, AIESL operates six stations across India and is looking to maintain a steady revenue base of ₹2,200-2,500 crore over the next few years. The company reported a turnover of over ₹2,100 crore in FY24 and anticipates a revenue of around ₹1,750 crore for FY25.
Enhancing Capabilities
With the goal of servicing newer aircraft models, AIESL is preparing to expand its capabilities to include aircraft such as the Airbus A350 and Embraer jets. The company currently employs around 4,500 technicians and is seeking certification from the European Union Aviation Safety Agency (EASA) to service European-registered aircraft.
Conclusion
AIESL's strategic expansion into Jewar and Navi Mumbai reflects its commitment to enhancing domestic MRO capabilities and meeting the growing needs of the aviation market. As competition intensifies, the company's investments and operational improvements will be crucial for maintaining its position in the industry.
