Kingfisher Airlines on Tuesday said it will not add new international flight routes immediately and also does not plan to take new aircraft deliveries for another two years.
Talking to the media after the annual general meeting of the company, Mr Vijay Mallya, Chairman and CEO, Kingfisher Airlines, said that the private carrier is not looking at expansion of international routes now, but will add frequencies to its existing international sectors such as Thailand, Singapore, London and Dubai.
On the airline’s fund raising plans, Mr Mallya said that the airline has “`drawn only half,” the Rs 2,000-crore it raised from the banks. The UB Group’s President and Chief Financial Officer, Mr Ravi Nedungadi, said the airline expects to “hear back from PE players in early-to-mid October”.
To augment its resources to meet working capital, capital expenditure and general corporate purposes, the company plans to raise funds through rights issue and global depository receipts of $100 million. In all, the company is looking at anywhere “between Rs 800 crore and Rs 1,000 crore”.
Domestically, the airline plans to “look at new routes sometime next year. This year, we will fly to Ludhiana and Pantnagar,” said Mr Mallya. “We need to be cautious in what we do,” he added. Though there is “definite improvement” in business sentiment, he said, “whether it is dramatic improvement or not is questionable. But the decline has stopped.”
The airline, which returned aircraft earlier to shrink domestic capacity, does not plan “to return any more aircraft,” he said. Kingfisher Airlines’ new deliveries will now come only in 2011.
On the employee strife that the sector has been witnessing of late, Mr Mallya said, “Each management needs to deal with its own employees differently. Fortunately, Kingfisher Airlines does not have any such problem. “Any carrier with long-serving employees” should look at the situation and take appropriate action, he added.
Source: The Hindu Business Line
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