Kingfisher, SpiceJet fly high on FDI news
Shares of Kingfisher Airlines Ltd & SpiceJet Ltd gained on Thursday on reports the civil aviation ministry has proposed that the government may allow 24% foreign direct investment (FDI) by foreign airlines.
By ET Online | Updated:
NEW DELHI: Shares of Kingfisher Airlines Ltd & SpiceJet Ltd gained on Thursday on reports the civil aviation ministry has proposed that the government may allow 24% foreign direct investment (FDI) by foreign airlines.
The government is likely to take a final decision on allowing foreign airlines to pick up stakes in Indian carriers in a ‘couple of weeks’, with the civil aviation ministry proposing a 24 per cent cap as against 26 per cent recommended by the industry ministry.
On Tuesday, UB group chief Vijay Mallya argued strongly for FDI by foreign carriers and permission for direct import of jet fuel to tide over the crisis in the airline industry.
Debt-ridden Kingfisher Airlines yesterday reported its net loss which doubled to Rs 468.66 crore in the quarter ended September 30, 2011 on account of a 70 per cent rise in fuel expenses.
“While the DIPP feels that allowing foreign airlines to invest in domestic carriers would help them raise the much- needed equity, it does not find support among many Indian airlines which feel that fledgling carriers would be susceptible to hostile takeovers as they were passing through a difficult financial situation,” said a report.
Analyst Call: Kingfisher Airlines Ltd
Mitesh Thacker, Technical Analyst, miteshthacker.com
The stock made a low of about Rs 19 on the 3rd of October, retested the same level on a closing basis recently about 4 days back.
It is trading above the last swing high of Rs 25. Though I have not been very clear on the chart patterns over here, but the way it looks like, it could probably head towards Rs 28. So if somebody wants to buy it, keep a stop loss at about Rs 23 and look for targets of Rs 28-28.5.
The government is likely to take a final decision on allowing foreign airlines to pick up stakes in Indian carriers in a ‘couple of weeks’, with the civil aviation ministry proposing a 24 per cent cap as against 26 per cent recommended by the industry ministry.
On Tuesday, UB group chief Vijay Mallya argued strongly for FDI by foreign carriers and permission for direct import of jet fuel to tide over the crisis in the airline industry.
Debt-ridden Kingfisher Airlines yesterday reported its net loss which doubled to Rs 468.66 crore in the quarter ended September 30, 2011 on account of a 70 per cent rise in fuel expenses.
“While the DIPP feels that allowing foreign airlines to invest in domestic carriers would help them raise the much- needed equity, it does not find support among many Indian airlines which feel that fledgling carriers would be susceptible to hostile takeovers as they were passing through a difficult financial situation,” said a report.
Analyst Call: Kingfisher Airlines Ltd
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Mitesh Thacker, Technical Analyst, miteshthacker.com
The stock made a low of about Rs 19 on the 3rd of October, retested the same level on a closing basis recently about 4 days back.
It is trading above the last swing high of Rs 25. Though I have not been very clear on the chart patterns over here, but the way it looks like, it could probably head towards Rs 28. So if somebody wants to buy it, keep a stop loss at about Rs 23 and look for targets of Rs 28-28.5.
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