Billionaire Rakesh Jhunjhunwala is set to enter the aviation industry with the aim of setting up his own ultra-low-cost airline with the name of Akasa Air. He said in an interview with Bloomberg that his airline is going to start with 70 aircrafts in the next 4 years.
Jhunjhunwala expects a no objection certificate from the Aviation Ministry over the next 15 days for Akasa Air where he will invest $35 million with a stake of 40 percent. In addition to this a former executive of Delta Air Lines INC is rumoured to join Akasa Air which can make the planes capable of carrying 180 passengers.
Jhunjhunwala who took the mantle of the Big Bull from Harshad Mehta said that he believes that the aviation sector might boom in the future in terms of demand. Due to the fear of the inevitable third wave air travel is set to have a negative affect in terms of demand which could increase the losses for many players in the industry due to further delayed recovery.
Before Covid, Kingfisher Airlines ceased functioning in 2012 despite being the second largest domestic-carrier. Jet Airways India Ltd collapsed 3 years ago and on the other hand IndiGo which is India’s largest airline suffered huge losses due to the pandemic.
Taking all these factors into consideration Akasa Air has the potential and the strategic management to capture a significant market share of the Aviation Industry in India as many firms who send their employees to on-site location would want to reduce their costs in every possible way & recover from the pandemic and as a result contribute to the V-shaped recovery of the Indian Economy.
Source: The Quint.