SP Tulsian, sptulsian.com is positive on SpiceJet and Jet Airways.
Tulsian told CNBC-TV18, “All this news indicates that Etihad seems to be a serious buyer and since they are in talks with all three of them I won’t be agreeing that Kingfisher is seen as a cheap deal by Etihad. If you see the market talks which they are talking of 48 percent for Rs 3000 crore that gives you Rs 6000 crore plus – it is very difficult to take a call that how much debt will get assumed whether the debt of entire Rs 7000-7500 crore will remain in the joint venture company or maybe after Etihad gets inducted.”
He further added, “The enterprise value for Kingfisher itself works out at about Rs 16000-17000 crore because Rs 7500 crore debt, Rs 6000 crore is the value and Rs 3000-4000 suppliers credit. So, in fact if you take a call on all three probably SpiceJet looks the best deal amongst all three followed by Jet Airways. But yes it is very difficult because maybe one doesn’t know that what kind of proposal will be given by Vijaya Mallya to all the bankers, those who have lent the money to Kingfisher Airlines because obviously he has to reduce the debt at least by 50 percent by paying some upfront amount of Rs 2000-2500 crore. So it needs to be seen that what is the loan restructuring happening on Kingfisher Airlines but in the near term one can keep a positive stance on all three airline stocks.”