Concerns over the future of the debt-ridden Kingfisher Airlines intensified on Thursday after the grounded carrier provided no concrete recovery plan even as a deadline to raise cash loomed large.
Kingfisher, grounded for more than a month after a violent staff protest and concerns about safety, widened its quarterly loss from a year ago as a curtailed schedule meant sharply lower revenue.
The carrier controlled by liquor tycoon Vijay Mallya, once India's second-largest by market share, has never turned a profit since its founding in 2005 and is saddled with roughly $2.5 billion in debt, according to one estimate.
The airline posted a record net loss of 7.54 billion Indian rupees ($139.46 million) for the September quarter, compared with a loss of 4.69 billion rupees a year earlier. Revenue declined 87 percent to 2 billion rupees from 15.5 billion rupees a year ago. The carrier said in a statement that it was preparing a comprehensive plan to re-start operations that would be shared with the airline regulator and bankers but did not say when it would be available.
Some analysts doubt Kingfisher will fly again and the company's failure to produce a concrete recovery plan on Thursday underlined concerns about its viability. Local media had reported that Kingfisher may present a rescue plan this week.
Creditors have set a Nov. 30 deadline for it to bring in fresh equity or an investor, the chairman of State Bank of India , its lead lender, told Reuters. He did not say what would happen if the demand was not met.
“It looks very difficult”, said a Mumbai-based equity analyst who did not wish to be identified because he does not cover the company anymore. “They have like 20 days to raise a billion dollars. I don't know how they can do that in 20 days, they haven't managed to do that in a year. “
Kingfisher has been scrambling without success to find fresh investment. No global airline has publicly expressed an interest in buying a stake.
The Centre for Asia Pacific Aviation has said a fully funded turnaround for Kingfisher would cost at least $1 billion.
This week, a top government official said India would not renew the airline's licence if it failed to provide a turnaround plan by the end of December.
SBI chairman Pratip Chaudhuri said on Wednesday Kingfisher needs to raise or commit at least $1 billion by