Regulatory dilemma: a changing dynamics of the Cochin international airport

What is it about?

In 2016 Airport Economic Regulatory Authority released new tariff regime for Cochin International Airport Limited.CIAL has undergone tuff challenge due to the tariff changes which will be implemented in 2017. This has impacted their ongoing business model. The CFO of CIAL is under pressure to share the impacts with the shareholders and to provide a way forward for the business.Cochin International was known to be one of the cheapest aeronautical tariff charging airports.The case discuss the issues of a public utility when it’s under a regulatory price regime. In this specific case, we are discussing regarding Cochin International Airport, which is a public utility under Public-private Partnership mode. Since 2016 regulator has changed the price regulatory regime from light touch to Hybrid till Regulation. The case explores the challenges due to the regulatory regime, how it affects Cochin Airports Strategy for Business.How should the management of CIAL to act on the above issue ?

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