Kingfisher Airlines to invest Rs 1,200 cr for expansion, global operations

Mumbai: Kingfisher Airlines Ltd plans to invest Rs 1,200 crore over the next two years for expansion and restructuring of its aviation arm. The company plans to spend the money on acquisition of aircraft, international foray and on restructuring of its balance sheet.

Speaking on the sidelines of the CFO India summit in Mumbai, Ravi Nedungadi, chief financial officer, United Breweries Group told FE' We would be investing close Rs 1,000 crore to Rs 1,200 crore for the next couple of years. With the big birds coming in by the early part of next year, there is going to be need for capital. We are looking at various ways of raising capital.”

By the end of November, the company will take the decision and would have a clear picture on the instruments to be raised. He said that the company has received some interesting proposals from bankers.

“We are not hesitant in taking debts, as we have always leveraged benefits from it,” added Nedungadi.

The company is harboring ambitious plans for the international market. Even before it could take off on its first flight, it believes the international operation will be a significant revenue earner for the company in future, “We believe that international is a way to go. Very quickly, the international operations can equal and overtake the domestic business because we are talking large numbers,” said Nedungadi.

The company would use the Deccan’s licence to fly overseas but will use the Kingfisher brand. Its first international flight will take off in July-August of 2008. 'We believe that there is a premium that people would pay for non-stop travel, given the fact that there is so much of problems and hassles at the airports, especially in security. We are intending in flying really long distances and our first flight is going to be Bangalore San Francisco.”

He said that UB Group believes in public listing, and may go for listing of Kingfisher next yea.