Mallya battles to keep Kingfisher flying

News that Vijay Mallya's struggling Kingfisher Airlines has suffered yet another record loss causes hardly a ripple any more.
What seems to perplex investors more is how India's self-styled "King of Good Times" - owner of a 311ft yacht, a Formula One racing team and a cricket club - has kept his cash-strapped carrier flying despite the headwinds it faces.
Mr Mallya, a flamboyant billionaire liquor baron and member of India's upper house of parliament, enjoys a high political profile.
"If market forces were allowed to operate in India I can guarantee you that Mallya would have shut down ages ago," says the head of a competing Indian airline.
Kingfisher has never turned a profit since it was founded in 2005 and its market share has shrunk, from the second largest to the smallest among India's six carriers.
Mr Mallya's friends say he has performed a miracle keeping the airline aloft, considering its net debt of about USD 1.5bn, by scaling down its fleet and pruning routes to a handful of profitable links between major cities.
13/06/12 Financial Times/Moneycontrol.com

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Categories: Kingfisher Jun 2012