Kingfisher plans $300-mn GDRs

With aviation turbine fuel or jet fuel prices beginning to move southwards, Kingfisher Airlines has resumed talks with investors for issuing global depository receipts (GDRs) to raise around $300 million, chairman Vijay Mallya said on Monday.

With aviation turbine fuel or jet fuel prices beginning to move southwards, Kingfisher Airlines has resumed talks with investors for issuing global depository receipts (GDRs) to raise around $300 million, chairman Vijay Mallya said on Monday.

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The airline had planned a GDR issue in December to reduce its debt but had failed to do so as its stock prices began slumping.

The company has appointed Citi, JP Morgan and CLSA as merchant bankers.

The carrier is also looking to lease both wide-body and narrow-body aircraft to meet an unanticipated surge in demand as the domestic economy recovers more quickly than expected, Mallya said.

Asked if Kingfisher’s current capacity was enough to cater to the projected increase in demand, he said: “Not quite, that is why we are looking for leased capacity.”

“Kingfisher at one time had several aircraft that were on order from Airbus for delivery in 2010 and 2011. During the 2008-2009 crisis, I actually postponed the delivery of those aircraft to 2012 and 2013. So right now we are looking for capacity, but our own new deliveries will start in about 18 months,” he said.

“We have been experiencing for the last six months unprecedented load factors, which I have never seen in the last six years. We are running at mid to high 80% on every flight, which is extremely healthy,” he added.

The airline will join the “Oneworld” alliance of airlines in February next year, Mallya said.

Kingfisher has 66 aircraft, mostly Airbus jets and ATR turbo-prop variants. It has more than 125 planes on order. India’s second-largest airline by marketshare has restructured its debt by converting almost Rs1,200 cr of loans into equity. Its current debt stands at about Rs6,000 crore.

PTI & REUTERS