Mallya outlines revival plan for Kingfisher, shares surge

MUMBAI Thu Jan 10, 2013 6:28pm IST

1 of 3. Vijay Mallya gives the thumb up at the end of the third practice session of the Italian F1 Grand Prix in Monza September 12, 2009.

Credit: Reuters/Max Rossi/Files

Stocks

   

MUMBAI (Reuters) - Shares in grounded carrier Kingfisher Airlines(KING.NS) jumped as much as 9.7 percent on Thursday after a letter sent to staff from Chairman Vijay Mallya outlined plans for a revival to be funded with 6.5 billion rupees from his UB Group.

Kingfisher, which lost its operating licence at the end of 2012 and has not flown since the start of October, filed its plan, which included the same funding amount from UB, to regulators in late December.

Kingfisher, once India's second-largest airline, is estimated to owe $2.5 billion in debt to banks, staff, vendors and others. The airline has tried unsuccessfully for more than a year to bring in new investors.

In his letter to staff on Thursday, a copy of which was obtained by Reuters, Mallya said the airline had submitted a detailed plan to the industry regulator to restart operations using seven planes by the start of the 2013 summer schedule, increasing to 21 planes in four months.

The second phase of the plan would see it expand to 57 planes within 12 months of a recapitalisation, Mallya said.

Kingfisher shares ended up 9.7 percent at 14.70 rupees. The stock hit a record low of 7.05 rupees in August.

"All challenges, like the license cancellation, (are) known. Any revival plan would be good for shareholders," said Deven Choksey, managing director of broker K.R. Choksey.

(Reporting by Indulal P.M.; Writing by Tony Munroe; Editing by Matt Driskill)

  • Most Popular
  • Most Shared

DEFENCE

REUTERS SHOWCASE

Canonisation

Canonisation

Pope declares sainthood of two Indians, four Italians.  Full Article 

Stake Sale Strike

Stake Sale Strike

Coal India trade unions call off strike in victory for Modi.  Full Article 

Arms Purchase

Arms Purchase

India approves $2.6 bln mounted gun purchase - official.  Full Article 

Interview with Bulgari CEO

Interview: Bulgari CEO

Bulgari CEO: we shouldn’t have left India so we’re back  Full Article 

Formula One

Formula One

Hamilton takes second F1 title in style.  Full Article 

Available For Remake

Available For Remake

Bollywood finally wants to pay the price for remakes  Full Article 

Davis Cup

Davis Cup

Vintage Federer seals first Davis Cup for Switzerland.  Full Article 

Movie Review

Movie Review

"Happy Ending" is old wine in an older bottle  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage