Kingfisher may lose Mumbai airport office, stock down 3%

Moneycontrol Bureau

Shares of Kingfisher Airlines are down 3% on media reports that Mumbai International Airport Limited (MIAL) is contemplating an eviction notice directing the airline to vacate the space occupied by it at Terminal IA at the Mumbai Airport.

A Times of India report quoting sources says that the debt-ridden airline owes the airport operator around Rs 22 crore toward parking and navigation charges.

These dues have not been paid for over a year now, states the report. The airline has been paying a portion of the dues in installments. In June, Kingfisher owed 60 crore to the Mumbai airport operator but has made some payments since then.

Due to financial constraints, KFA has completely suspended operations from various airports.. In such a scenario, even KFA has decided to vacate space since it is not operating flights, states the report further.

Meanwhile, the airline has not yet submitted a revival plan to the airport regulator. Lenders to the carrier are also set to take the "final call" on settling their outstanding dues after the proposed meeting with the company's chairman - Vijay Mallya. However, the company is yet to give any confirmation on its schedule.

It has been almost a year since the loan account slipped into the sub-standard category, the first level of non-performing assets (NPAs). Banks will now start marking down it as doubtful asset, the second level of NPAs. It will raise the provisioning requirement from 15% to 30%. A consortium of 17 lenders loaned around Rs 8,000 crore to KFA.