Will Kingfisher able to infuse Rs 2000 crore equity ?
Vijay Mallya-promoted Kingfisher Airlines is targeting an
equity infusion of around Rs 2,000 crore through strategic and financial
investors and may even monetise aircraft order book over time.
The infusion would happen upon “regulation change” and the equity investment
will be used to de-leverage the balance sheet, the company told investors
recently. “Likely change in legislation of 25% investment by foreign airlines
is expected to bring strategic partners eyeing a play in the Indian market
which is expected to be the fastest growing market in the next few years,” it
said.
Mallya had recently said that he would rather raise funds through equity than
debts. “I am talking of raising equity. I have not talked about additional
borrowing,” he had said. Airlines network, brand franchise and easier
operational environment makes it an attractive option for equity investment,
the carrier told investors.
Based on the discussions the airline is holding, it estimates gains of up to Rs
500 crore by way of deferment of aircraft schedule.
When asked how much equity is Mallya mulling to sell, the airline spokesperson
said, “It is not our policy to comment on issues that are price sensitive.
Mallya has already stated that we have signed a term with a PE firm and we are
unable to comment or elaborate beyond that”. Kingfisher made a loss of Rs 626
crore for the third quarter. The present market capitalisation of the airline
is Rs 865.53 crore.
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