Iran is set to create a boom for aircraft lessors as the country needs hundreds of modern aircraft that Western manufacturers will not be able to meet due to a years-long order backlog, the head of Irish lessor Avolon said on Wednesday.

Tehran signed a nuclear agreement with six major powers in July in a deal that would lift all economic commercial sanctions, including those relating to commercial aviation.

Avolon, the world's 11th largest aircraft lessor according to industry database Flightglobal, said the country could ultimately catch up with neighbouring Turkey, which has a similar population and a fleet of 500 planes. The average age of the Iranian fleet is 26 years compared with six years in Turkey, according to Avolon research.

"Iran I think will be a boom, a real opportunity for the lessors in the next couple of years," chief executive Domhnal Slattery said in an interview on Wednesday. "There is no kit available from the manufacturers of any quantum for the next five to seven years."

Avolon, which owns and manages over 150 aircraft, has seen its share price increase 50 per cent to $29 since its December initial public offer (IPO), valuing the company at $2.4 billion.

Slattery declined to comment on two rival bids for the company that value it at $30 and $31 per share respectively.

Avolon reported a net income of $56 million in the three months to June, up 133 per cent compared to the same period last year. It said it has $1.4 billion of delivery commitments for 2016.

Avolon expects interest rates to rise, with a possible move from the US Federal Reserve in September, but Slattery said the company was "very well protected" against higher rates due to careful matching of liabilities and fixed-rate funding.

Rising interest rates will also likely drive inflation, which Slattery said would provide an "extremely positive backdrop for aircraft leasing." - Reuters