Kingfisher down 5% after govt cancels int'l flying rights

Moneycontrol Bureau

Shares of Kingfisher Airlines (KFA) tumbled around 5 percent to Rs 10.74 after the civil aviation ministry withdrew its international flying rights along with cancellation of slots at domestic airports.

KFA offered over 3,500 seats each day on international network and now these will be given away to other airlines that operate on same routes. Simultaneously, the airline's domestic will also be given away to other carriers.

The airline has been grappling with operational and financial issues since over a year. Its lenders have warned the airline to clear debt of over Rs 6,000 or face their wrath. Its employees too have frequently gone on strikes for not getting salaries on time. Last year, Hindustan Petroleum encashed the airline's  bank guarantees as it was unable to pay over Rs 300 crore toward oil dues.

The airline which stopped flying late last year is yet to renew its flying licence which expired two months ago. The airline had earlier said, rising fuel cost and capital costs, coupled with competition-induced price wars led to huge accumulated losses and mounting debts.

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