Kingfisher to raise up to Rs 450 crore

Kingfisher Airlines, owned by billionaire Vijay Mallya, has said it intends to raise up to Rs 450 crore through various instruments, including Global Depository Receipts.

A resolution to this effect was passed at a board meeting on Monday. This intent to raise funds comes nearly a month after the company enabled itself to raise up to Rs 500 crore by way of a rights issue of shares.

Kingfisher has been trying to raise funds to reduce its debt burden of Rs 6,000 crore on a base of Rs 270 crore, a leverage of nearly 20 times. To pave the way, it is also seeking approval of shareholders for increase in the authorised share capital from Rs 500 crore to Rs 1,000 crore.

Mallya has been lobbying with the Union government to allow foreign airlines to invest in the Indian aviation sector. Till that happens, Kingfisher would have to use other financial instruments.

For the quarter ended June 30, it posted a loss of Rs 242 crore, a rise from the Rs 158 crore loss during the same quarter last year. The topline fell to Rs 1,313 crore from 1,398 crore, as the company slashed capacity by 23 per cent after the aviation industry went into turbulence. Kingfisher has also returned aircraft and postponed deliveries, and has moved 70 per cent of its network to single class, low-fare, options.