Story of the fall of Kingfisher Airlines

 Vijay Mallya, the brewery tycoon who is part-owner of India’s second-biggest airline,  told reporters that Kingfisher hadn’t asked the government or its banks for a bailout or  failed to pay its fuel suppliers. The owner of India’s beleaguered Kingfisher Airlines  blamed high fuel taxes and airport charges for its woes Tuesday after posting a  quarterly loss of 4.69 billion rupees ($93 million) amid cancellations of hundreds of  flights.

Reason of fall

1. Acquisition of Deccan airways at the time of Global economic Meltdown(2008-2009)
2. Effect of Economic slowdown between 2008-2009
3. Recovery time is not sufficient to recover all debt i.e. 2010
4. High fuel price, high crude oil price & Global slowdown in 2011
5. Yield is low & Capital is high
6. Bigger ad valorem sales tax
7. High state sales tax
Government has to take action for Recovery of debt of kingfisher airline
1. Restructuring the carrier’s loans again
2. Banks have to classify the asset as non-performing
3. Bankers have to keep the re-payment period and net present value of asset
4. Promoters would need to infuse more capital in the company
5. Reduction in prices of aviation fuel and reduction of sales tax on Aviation fuel
6. Reduction of state sales tax

Kingfisher has been in the red since beginning operations in 2005.

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