Kathmandu. New helicopter companies have started in the Nepali sky. New companies such as Sagarmatha Air, Gaganchumbi Air, Sumedha Air, and Heli Nepal are in the process of acquiring licenses and Air Operator Certificate (AOC) to address the growing demand for tourism, rescue, and accessibility to remote areas.
Helicopter service has always been the centre of attraction of Nepal due to geographical complexity and abundant tourism potential. Out of a dozen helicopter companies currently in operation, four new companies have started the process of starting services.
These companies are preparing for commercial flights meeting the technical and safety standards of the Civil Aviation Authority of Nepal (CAAN).
Who is the new player ?
Sumedha Air: } Non-Resident Nepalese (NRN) is investing in the company, which aims to provide service through three modern helicopters. The company has already established its corporate office in Kathmandu and it seems to be in a slightly more mature phase than others.
Everest Air: {TAG_OPEN_span_35{TAG_CLOSE_span_35}} This company has been registered with a huge investment commitment of Rs 84 crore. It has set a target of about 1,269 flying hours per year. As a result, its competitive presence in the market is seen as meaningful.
Skyscraper: This company plans to focus exclusively on mountain flight, charter, and patient rescue. Its strategy of combining both tourism and rescue seems to be commercially balanced.
Heli Nepal: It is said that it will bring large helicopters along with small helicopters. If successful, Nepal will develop a separate capacity for transporting heavy goods and large groups.
How profitable is TAG_OPEN_strong_38 the helicopter business?
At present, around 12 airlines including Air Dynasty, Simrik Air, Manang Air, Shree Airlines, Prabhu Helicopter, Kailash Helicopter are active in Nepal.
According to the transaction data, some established companies are making good profits. For instance, Altitude Air earned 18 percent net profit in the last fiscal year with a turnover of Rs 560 million.
While the helicopter business may seem lucrative, it is extremely expensive and risky. The cost of a new helicopter is 50 to 60 crores. In addition, rising fuel prices, high salaries of foreign pilots, and dollar payments for maintenance are all likely to weigh heavily on the cost.
The insurance premium has also increased due to the fake rescue scandal and security tightening in helicopter rescue in recent times. This has reduced the profit margins somewhat.
It is not easy for new companies to establish themselves in the market. When there are so many companies in a small market, there can be competition for price. This affects the financial health of the company.
It is difficult to win the trust of international tourists as Nepal’s aviation sector remains in the European Union’s blacklist. The future of new companies will depend on how strong their security systems are. The uncertainty of the weather and the experience of the pilots are the bases of success in the flights in high mountains.
The arrival of new helicopter companies in the Nepali sky is sure to diversify the service and increase the options for the customers. This business does not survive only on investment and advertising. Only a company that can adopt safety, business discipline, and a sustainable business model can fly long flights in Nepal’s challenging mountain skies.
