India airlines least in need may gain most from new rules

Mumbai: India’s decision allowing airlines to sell stakes of as much as 49 per cent to overseas carriers may be most beneficial to operators least in need of investment.
SpiceJet Ltd, which has said it’s in “no rush” for funds, may be the most appealing target for foreign investors because of the discount carrier’s low debt and record of profitability, said Sharan Lillaney, an Angel Broking Ltd analyst. Kingfisher Airlines Ltd may struggle to win investment, even as billionaire Chairman Vijay Mallya seeks new financing, after posting at least five straight annual losses.
“The biggest beneficiary will be SpiceJet as it has lower debt and a decent brand image,” Lillaney said. “Kingfisher needs to restructure its balance sheet and convert debt into equity before it can look at attracting any foreign investment.”
18/09/12 Bloomberg/Gulf News

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Categories: Foreign Sep 2012, Indian Aviation- In General Sep 2012, New Sep 2012