Shares of Vijay Mallya owned Kingfisher Airlines rose over 3 per cent today on the bourses in early trade as investors cheered the air carrier's fund raising plans.
Recovering from the yesterdays session's losses where it had lost nearly 1 per cent, the scrip jumped by 3.45 per cent to an early high of Rs 61.40 on the Bombay Stock Exchange. In similar fashion, the scrip climbed 3.28 per cent to Rs 61.30 on the National Stock Exchange. Marketmen said the scrip recovered on the airline's move to raise funds as a part of its newly unveiled financial restructuring plan.
Besides, the rise in the stock was also in line with the strong broader market.
The 30-share benchmark Sensex was also trading firm at 18,118.77, up 0.82 per cent over the previous close. The airline yesterday said that it will immediately seek to raise up to USD 250 million through Global Depository Receipts (GDRs) in order to reduce its debt burden, and a further Rs 500 crore through a domestic offering subject to necessary regulatory approvals.
The funding exercise will complete within next 3-4 months, the statement added. The debt burden of the airline as on March 31 2010, stands at Rs 6,000 crore and bulk of it consists long-term loans.
Besides, the board of United Breweries (Holdings) Limited -- holding company of the airline -- had decided to convert Rs 650 crore provided by it as loans (to the airline) into preference share capital, the statement said. Boosted by the development, shares of United Breweries rallied 6.5 per cent to hit an all-time high of Rs 423.90 on the Bombay Stock Exchange