Air India IPO only in steady market

New Delhi: Civil aviation minister Praful Patel has said the government will consider listing of national carrier Air India on the bourses after the capital market improves. "But the airline will not lose its public sector character and it will not be privatised," he told mediapersons after assuming charge for the second consecutive term. He did not specify any time-frame for the proposed initial public offering (IPO).
Mr Patel also said there would be no further privatisation of airports in the country, although the private sector could invest in greenfield airport projects.
The IPO of Air India will bring in "much-needed liquidity infusion" and also "accountability," the minister said. The carrier is an integral part of the aviation sector and balances market forces, he said.
The public sector airline is estimated to have lost about Rs 4,000 crore in 2008-09 mainly on account of high fuel price in the first half of the fiscal and irrational pricing of tickets. It is working on a proposal seeking government money to revitalise itself. The country’s largest carrier by fleet size is expected to ask for Rs 1,231 crore as equity infusion and Rs 2,750 crore as soft loan from the government.
An airline official, who did not wish to be named, said the government has clarified that the company would have to put its house in order for getting financial help.
02/06/09 Economic Times

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Categories: NACIL Jun 2009