Jet Air Raises Fares as Consolidation Eases India Price Wars

Jet Airways (India) Ltd., forced to sell 60 percent of tickets at a discount last fiscal year, has raised fares after three airline tie-ups eased competition.
India's biggest domestic carrier has increased some fares by 200 rupees ($5) since last month and also cut the number of tickets it sells at a discount, Executive Director Saroj Datta said by phone yesterday. He declined to elaborate as the company will report second-quarter earnings later this month.
Jet's acquisition of Sahara Airlines Ltd. earlier this year and the merger of two state-owned carriers has curbed price wars that caused fares to plunge. More expensive tickets will help the airline industry return to profit in 2008 after expected losses of $500 million this year, said Nikhil Vora, an analyst at SSKI Securities Ltd.
Jet plans to sell shares to help pay for new planes and to increase its capital, which will enable it to borrow more, Datta said. The carrier expects to raise as much as $400 million by January in a rights offering in India, he said. The sale, previously scheduled for this month, was delayed due to ``market conditions,'' Datta added.
The airline also made a profit from the sale and leaseback of four Boeing Co. 737 aircraft last month, he said, without elaboration.
11/10/07 Anand Krishnamoorthy/Bloomberg

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Categories: Jet Airways Oct 2007