When news first trickled in that Kingfisher is going broke, I posted, But Pappu can’t FLY saala……, and haafter recent news very sadly I have to say, Ch..Ch..Pappu still can’t Fly Saala….. (hardly did I, for that matter we, imagine that we would have to say this!!!)
Future of Kingfisher Airlines is still uncertain and no self initiative taken by the company itself, it looks like this problem will persist for some more time. The top management in Kingfisher hopes that the Indian government would lend bail out option to Kingfisher, but with the kind of flamboyant, cocky lifestyle Vijay Mallya treads, there is increasing chorus against the bailout option within political, social and business circles. So severe was the reaction from business fraternity for this bailout that Rahul Bajaj said it will be "privatization of profits and socialization of losses".
Aviation industry is very cash intensive industry. With debts running in thousands of crores of rupees, sources & options of funding dwindling, Kingfisher is strangulated. The banks who have already lent the money have very little option to recover it.
But in spite of all this, Kingfisher Airlines needs to be saved, since there are many employees still working in Kingfisher Airlines and strong aviation industry is what India needs. It is high time; the lenders take the reins in their hands by converting their debt into equity, going for a complete overhaul of the current management.
Once the operations are streamlined and lenders have recovered their money, they can separate themselves from Kingfisher. With PE majors like TPG, Blackstone, Cerberus Capital already showing interest in buying promoter stake in KFA, there seems to be some light at the end of tunnel.
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