Kingfisher Airlines zooms 15% on stake sale buzz

MUMBAI: Shares of Kingfisher Airlines surged more 15 per cent after reports that the airline has requested the government to allow foreign ownership of up to 25 per cent and said it had received several expressions of interest from foreign airlines.

The move comes as the Centre is planning a policy change to allow foreign airlines to invest in domestic carriers with a cap of just below 26 per cent, according to media reports.

Kingfisher is reportedly believed to be discussing stake sale with three foreign airlines ��� British Airways, Singapore Airlines and Virgin ��� as a strategic investment is expected to fetch better valuation compared to the numbers indicated by PE investors.

Indian aviation companies have been hit by the global financial meltdown, high oil prices and over capacity in many routes. Due to the slowdown, the passenger load factor has also come down on an average 15 per cent. The sector may suffer a combined loss of Rs 10,000 crore.

At 10:20 am, the airline's shares rose 15.72 per cent to Rs 30.55 with volume traded at 5,75,375 against two week average of 4,18,632 shares.