New Delhi: Shares in debt-laden Kingfisher Airlines plunged Wednesday on reports that lessors have taken back a number of planes because the company had reportedly defaulted on lease rentals. The carrier confirmed that the company had returned some aircraft, but denied that the move was over a default in payments.
"There have been no 'forced' returns of aircraft to lessors. We are currently in agreed payment terms to lessors. We have voluntarily returned aircraft surplus to our requirements," the spokesperson said.
Shares in the company traded 10 per cent lower at Rs 12.10 on the BSE, underperforming the broader Sensex, which traded 0.5 per cent higher at 16,993.
The company has been relegated to the bottom, with a mere 5.2 per cent market share in May from as high as 20 percent last year, on account of truncated flights.
Kingfisher Airlines has not posted profit since its inception in May 2005. The company reported a loss of Rs 1,151.5 crore in the March quarter, and has debt of over Rs 7,500 crore.
The Bangalore-based carrier has been defaulting on tax payments and bills to its vendors. It has been seeking fresh bank funds since December, and also tried to raise overseas funds unsuccessfully.
Bankers want the promoters, including chairman Vijay Mallya, to bring in at least Rs 2,000 crore in fresh capital before they consider the carrier's demand for fresh funds.
Kingfisher has pledged assets that include its brand and office furniture for Rs 6,400 crore bank loans, according to the Finance Ministry. A luxury villa in Goa, two helicopters, a building in Mumbai and shares have been used as collateral for loans as of November 2011.
(With PTI inputs)
"There have been no 'forced' returns of aircraft to lessors. We are currently in agreed payment terms to lessors. We have voluntarily returned aircraft surplus to our requirements," the spokesperson said.
Shares in the company traded 10 per cent lower at Rs 12.10 on the BSE, underperforming the broader Sensex, which traded 0.5 per cent higher at 16,993.
The company has been relegated to the bottom, with a mere 5.2 per cent market share in May from as high as 20 percent last year, on account of truncated flights.
Kingfisher Airlines has not posted profit since its inception in May 2005. The company reported a loss of Rs 1,151.5 crore in the March quarter, and has debt of over Rs 7,500 crore.
The Bangalore-based carrier has been defaulting on tax payments and bills to its vendors. It has been seeking fresh bank funds since December, and also tried to raise overseas funds unsuccessfully.
Bankers want the promoters, including chairman Vijay Mallya, to bring in at least Rs 2,000 crore in fresh capital before they consider the carrier's demand for fresh funds.
Kingfisher has pledged assets that include its brand and office furniture for Rs 6,400 crore bank loans, according to the Finance Ministry. A luxury villa in Goa, two helicopters, a building in Mumbai and shares have been used as collateral for loans as of November 2011.
(With PTI inputs)
