ZEE Business
ZEE BUSINESS
हिंदी में पढ़ें  हिंदी में पढ़ें
Live TV
Live TV
  • Home
  • Budget 2023
  • Adani Saga
  • Markets
    • Stocks
    • Global Markets
    • IPO
    • Companies
    • Currency
    • Commodities
  • My Money
  • Calculators
    • Income Tax Calculator
    • Home Loan/EMI Calculator
    • Mutual Fund Returns Calculator
    • Personal Loan Calculator
    • Car Loan Calculator
    • SIP calculator
    • Lumpsum Calculator
    • SWP Calculator
  • Videos
    • M Se Market
    • Jeb Zindagi Zaroorat
    • Light Camera Stocks
    • Tech Takes
    • Big Bulls Ka Nishana
    • Paisa Wasool
    • Commodity Ke MrityunjayMantra
    • The Right Property Show
  • Economy & Infra
    • Policy & Initiatives
    • Agriculture
    • Telecom
    • Aviation
    • Railways
    • Retail
    • Roadways
    • World Economy
  • Exclusive
    • Wealth Guide
    • Interviews
  • Auto
    • Cars
    • Bikes
    • Electric Vehicle
    • Commercial Vehicles
  • Tech
    • Mobiles
    • Gadgets
    • Reviews
    • Tips and Tricks
    • Apps
  • Real Estate
    • Home Buyers
    • Builders
  • Axis MF
  • Trending
    • Entertainment
    • Politics
    • Lifestyle
    • Travel
    • Sports
    • Viral
    • Education
    • Jobs
Read in App
Business News » Companies News

Air Costa in talks with foreign airlines for stake sale

  • Twitter
  • Facebook
  • Linkedin
  • whatapp
  • View in App
Air Costa in talks with foreign airlines for stake sale
The airline operates from eight airports, mainly in southern India, as a regional carrier with a fleet of three Embraer 190 aircraft. Representational image. Image Source: Pixabay

Air Costa is at "advanced stages" of discussions with foreign carriers, including those from the Gulf, for a possible stake sale, as the Vijayawada-based airline seeks to spread its wings after securing flying permit for pan-India operations.

The carrier, which received pan-India licence from aviation regulator DGCA this week, is also in the process of sealing a deal for leasing of six more aircraft from GE Capital Aviation Services of Singapore, which is expected to be in place by this month, its CEO Vivek Choudhary said.

Currently, the airline operates from eight airports, mainly in southern India, as a regional carrier with a fleet of three Embraer 190 aircraft.

On Monday, it secured pan-India operator permit from the Directorate General of Civil Aviation (DGCA), putting it in the league of budget carriers such as SpiceJet, IndiGo, GoAir and AirAsia India.

"We are in talks for (stake sale), which are at advanced stages, with carriers from the Gulf and an airline from South-East Asia," Choudhary told PTI in an interview over phone from Vijayawada.

He said the quantum of stake to be diluted has not yet been decided, adding that "that is under discussions".

The top Air Costa official said securing a national flying permit will "boost the airline's prospects of taking a foreign partner on board" and sounded confident of "coming to conclusion" in forging a partnership soon.

According to Choudhary, the airline expects to start pan-India operations from the first quarter of 2017-18. To begin with, the airline is looking to connect smaller cities such as Vijayawada, Tirupati and Visakhapatnam with Delhi.

"We will also be providing air connectivity to such cities from Mumbai, going forward, under our all India operations," he said.

On the fleet induction, Choudhary said Air Costa will be inducting a fourth Embraer this month. The airline has an LoI (Letter of Intent) for leasing of six more aircraft and it was likely to ink a pact with GE Capital Aviation Services this month.

"We have an LoI on the table for leasing of six aircraft at this moment, which hopefully we should be able to formalise by this month. The delivery of these planes will commence from January next year," he said.

Air Costa aims to have a total of 10 E190 planes in its fleet by December 2017.

"We will be inducting one aircraft every two months between January and December next year," Choudhary said. 

On competition in the low-cost carrier segment, which accounts for nearly 70 per cent of the total domestic air passenger market, Choudhary said his airline would target the niche 80-150 seater segment - which is growing at more than 35 per cent on-year.

Significantly, while other budget carriers have 180-seater Airbus or Boeing 737 (for metro and tier II cities) as well as 72/42-seater ATR/ Bombardier Q400 operations (for smaller cities), Air Costa has 110-seater planes in its fleet.

"The market is spread in three categories -- up to 80- seater which is captured by ATRs and Bombardier Q400s, 80-150-seater, and 150 and above such as A320s and B737s. So, we are the only player in the middle category, which is growing at more than 35 per cent y-o-y. So, we should be able to capitalise (on) this," he said.

Noting that the government's proposed regional connectivity scheme and improvement in airport infrastructure would further boost this segment, Choudhary said the pan-India air operator permit has come at the most appropriate time for Air Costa.

On funding requirements for the airline, which had to cancel all its flights for one full day last month due to "cash problem" and issues with aircraft lessor over lease rental payments, he said Air Costa is seeking to raise funds for its expansion plans.

"The procurement of pan-India licence itself shows confidence in the airline. For operating the airline, we are able to sustain on our own," he said.

With the planned induction of aircraft, Choudhary said the airline's per day losses are expected to come down.

"We hope to break even with the induction of the 10th aircraft, which will be delivered to the airline in December 2017," he noted. 

Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.

TAGS:
Air CostaAir Costa stake saleAviationEmbraer jetbudget carrierGE Capital Aviation ServicesDirector General of Civil Aviation (DGCA)
Written By: PTI
Updated: Wed, Oct 05, 2016
03:37 pm
PTI
RELATED NEWS
DGCA suspends Air Carnival's flying permit DGCA suspends Air Carnival's flying permit
Air Costa's woes worsen; more than 40 pilots quit Air Costa's woes worsen; more than 40 pilots quit
Despite bottom line pressure, FY17 to be the best for airlines Despite bottom line pressure, FY17 to be the best for airlines
Air Costa suspends all flights till March 15 Air Costa suspends all flights till March 15
Domestic air passenger traffic up 23% in 2016 Domestic air passenger traffic up 23% in 2016

LATEST NEWS

Dabur Q3 Results 2023: Inflationary pressure dents profit despite higher revenues; Consol PAT drops 5.4% YOY to Rs 3,043 crore

CBSE Admit Card Class 10, 12 to be released soon on cbse.nic.in: Check steps to download

Mahila Samman Saving Certificate: New small savings scheme for women announced in Budget 2023 | Check Where and How to Open Account, eligibility, interest rate, maturity, Tax benefits - All you need to know

Sebi mulls regulatory framework for REITs, InvITs to issue depository receipts

US Stock Market: S&P 500, Nasdaq jump after Fed hikes rate along expected lines, Jerome Powell switches to a dovish tone

Tata Power Q3 Results Preview: Net profit likely to more than double to Rs 877 crore

India Vs Australia Schedule 2023: Ind v Aus Test match dates, venue, time table, squads, Live streaming, when and where to watch, other details

Samsung Galaxy S23 Series starts from Rs 74,999 in India

Kendriya Bhandars begin selling flour or 'Bharat Atta' at Rs 29.50 per kg; NAFED, NFCC to start from 6 February

Budget 2023: Govt's push to new tax regime with rebate limit up to Rs 7 lakh may impact India's insurance business - Experts opine

  • India News
  • World News
  • Companies News
  • Market News
  • Personal Finance News
  • Technology News
  • Automobile News
  • Small Business News
  • Income Tax Calculator
  • Live TV
  • Videos
  • Photos
  • Author
  • Rss Feed
  • Advertise with us
  • Privacy Policy
  • Legal Disclaimer

Latest Trending Updates

  • EPFO
  • Budget 2020
  • Income Tax Return
  • Auto Expo 2020
  • Home Loan
  • Business News

Trending Topics

  • Income Tax
  • income Tax Calculator
  • 7th Pay Commission
  • Reserve Bank of India
  • GST
  • Latest Business News

Follow us on

zeebiz
zeebiz

Partner Sites

  • Zee News
  • Hindi News
  • Marathi News
  • Bengali News
  • Tamil News
  • Malayalam News
  • Gujarati News
  • Telugu News
  • Kannada News
  • DNA
  • WION
© 2023. India Dot Com Private Limited. All Rights Reserved.
LIVE TV