Jet shareholders approve $400

September 25, 2009

Jet and Kingfisher Airlines, the other private full-service carrier in the country, badly require an equity infusion to remain afloat, said an aviation analyst requesting anonymity.

Jet is yet to decide on the fund-raising instrument. As reported by ET, the company has sought the government’s permission to sell shares to overseas investors as it may be hard to raise $400 million from domestic investors alone.

Any share sale will result in dilution of shareholding of the promoters who hold 80% in the company. The Jet stock slipped 0.35% to close at Rs 311 on BSE.

The domestic aviation industry has been badly hit by surging crude oil prices last calendar year, which touched a high of $147 per barrel in September last year. With economic slowdown making people go for cheaper options, full-service airlines have been forced to keep their fares very low to check travellers from moving to low-cost carriers. In the process, they are piling up losses, while budget carriers such as IndiGo and SpiceJet are making money. Jet suffered a net loss of Rs 225 crore for the quarter ended June 30, 2009, on a total income of Rs 2,428 crore. It posted highest-ever loss of Rs 961 crore in the year ended March 31, 2009. kingfisher airlines booking