Akasa Air - What We Know So Far About The Ultra-Low-Cost Airline Backed By Rakesh Jhunjhunwala
The aviation sector in India, especially the highly competitive, budget airlines are notorious for bleeding money.
Over the years, many big and small carriers have come and gone in the Indian skies, and it still remains a not so tempting turf for an investor.
So, when last week ace Indian investor Rakesh Jhunjhunwala said he was going to back a new airline, many were left shocked.
Given how bad the track record has been and the pandemic adding to the woes of private carriers in India, aviation was the last sector someone like Jhunjhunwala was thought to show interest.
Jhunjhunwala will hold 40% share
But Jhunjhunwala is serious and has said that he will be investing $35 million (around Rs 260 crore) in the new ultra-low-cost airline and will hold about 40% stake in the company.
Though it has not been officially announced yet, the new airline is likely to be called Akas Air and aims to have a fleet of 70 aircraft in four years.
Among those onboard for the billionaire's new venture is Vinay Dube, the former chief executive officer of Jet Airways and GoAir.
Another cofounder is Aditya Ghosh, who spent a decade with IndiGo and was credited with its early success.
Coming soon
According to the Times of India, ¡°SNV Aviation¡±, which will be the holding company for the proposed budget airline has already sought a no-objection certificate (NOC) from the aviation ministry.
The airline is eyeing to take to the skies later this year or early 2022.
¡°It will be a long haul and the new airline will be very severely tested but the capitalisation and the start team gives confidence that it is possible for them to be successful,¡± CAPA India head Kapil Kaul said.
Jhunjhunwala is throwing his hat in the ring at a time when the Indian aviation sector, is reeling from the effects of the pandemic.
Still, it has been some noise - especially with the disinvestment of Air India, which so far has not happened. In all likelihood, the Tata Group, which once owned Indian Airlines before it was nationalised will be the new owners of the flagship carrier.
The Tatas already operate Air Vistara and Air Asia India.
Jet Airways 2.0
The other major development in the Indian aviation industry that is likely to happen this year is the relaunch of Jet Airways that was grounded in April 2019.
Under new management, Jet Airways was founded by Naresh Goyal is eying a comeback.
Backed by a consortium comprising UK-headquartered Kalrock Capital and Murari Lal Jalan, a UAE-based entrepreneur, Jet Airways 2.0 will fly again this year, but a date for it has not been officially announced yet.
The entry of a new player is good news for the likes of Boeing and Airbus which have been struggling in the past few years due to order cancellations and grounding of many low-budget carries.
