Air India crisis: IPO may turn the tide of Maharaja

Mumbai: A public listing of Air India (AI) at the earliest could change its fortunes though the government would not fetch any returns on its investment in the loss-making national carrier. Going by civil aviation minister Ajit Singh's observation that the air carrier can return to profits only after 2018, no initial public offering (IPO) is possible before 2020 as the Securities and Exchange Board of India (Sebi) rules requires a threeyear track record of consistent profit making.
An IPO may not give any premium considering the ailing national carrier's monstrous liabilities, but it can certainly help in bring transparency, professionalism and accountability, which is currently lacking in AI .
"It is better to close down the airline as Air India has got into several problems. An IPO may be an option but the public will not invest. If the government is writing a Rs 30,000 crore cheque, it should clean up Air India's balance sheet and sell the airline to somebody for Rs 5,000 crore," said Mohan Kumar, former chief financial officer (CFO), Air Deccan.
09/06/12 Lalatendu Mishra/Business Today

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Categories: Air India Jun 2012, New Jun 2012