"Without an investment of approximately US$600m (INR3,337 core) in the next 30-60 days, Kingfisher faces the prospect of an operational shutdown, possibly temporarily, to allow it to restructure and re-organize. In Q1 (first quarter, 2012-13) the promoters invested US$133.9m, but this barely allows the airline to survive.” the report said.
According to the advisory company, a restructuring of the airline will require banks to take a significant hit as they have huge exposure to bad debt given to the carrier.
The airline also faces frequent labour unrest with one group or the other of employees going on flash strike demanding payment of salaries and other reimbursements.
The airline had the lowest market share in July which stood at 3.4 percent.
The report estimated the airline to make a total loss of $220-$260 million in 2012-13. The company had reported a net loss of Rs.650.78 crore ($117 million) for the quarter ended June 30, 2012.
Air India, national flag carrier, also estimated the loss to be of $1.3 billion. On the other hand, the four private players - SpiceJet, IndiGo, GoAir and Jet Airways - are on track to achieve $200 million profit for 2012-13.
Theresa
(Source: IndiaTimes)
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