SP Tulsian positive on Kingfisher Airlines, Jet Airways

SP Tulsian of sptulsian.com is positive on Kingfisher Airlines and Jet Airways.

Tulsian told CNBC-TV18, “Reliance Infrastructure has been seen under accumulation maybe for last one month or so. That applies for Reliance Capital also. I am expecting that breakout to happen in Reliance Capital which can take the Reliance Capital to move to Rs 530 and Reliance Infra to maybe Rs 590 to Rs 600 or so. So both the stocks have been holding the levels and have been seen under accumulation for quite some time. So maybe the breakout has come today.”
He further added, “If you see the developments or the news which is coming in from the sources and all that, that indicates that Eithad is quite keen with Kingfisher Airlines (KFA) and I have been maintaining that view that probably that is because of the valuation because if you take the enterprise value of KFA, it is working out at about Rs 15000-16000 crore while in case of Jet Airways it is working out at Rs 23000-24000 crore because the debt portion in Jet is also quite high at Rs 13000 crore. But only problem with KFA is that we have not seen any headway having made by the promoters that is UB Group either in respect to giving some revival plan to the DGCA or to banks. And once that happens because I have been maintaining that the group will be requiring a substantial amount which can run into at least may be Rs 3500-5000 crore because they need to pay substantial money to the bank also to ask for restructuring and everything. So once that happens then definitely Eithad will be keen because if you see the recall value of the brands, KFA once they again start operations it will be very easy for them to capture the market share of close to about 15 percent. So I am quite confident that the inclination of Eithad will be more on KFA but yes till then I’ll be keeping my positive stance on both stocks, KFA and Jet as well."