Group 10 proposes a financial management project to analyze Kingfisher Airlines' losses since its inception in 2003. Kingfisher invested heavily in expanding its aviation business but was unable to recover operational costs, eroding its net worth. With total debt of Rs. 7000 crores and losses of Rs. 1027 crores in 2011 and Rs. 5690 crores since 2003, Kingfisher owes substantial unpaid dues to fuel suppliers, airports, and lessors. Unable to meet costs and breakeven points, Kingfisher canceled over 200 flights and returned 24 leased aircraft, damaging its brand as a 5-star airline.
Group 10 proposes a financial management project to analyze Kingfisher Airlines' losses since its inception in 2003. Kingfisher invested heavily in expanding its aviation business but was unable to recover operational costs, eroding its net worth. With total debt of Rs. 7000 crores and losses of Rs. 1027 crores in 2011 and Rs. 5690 crores since 2003, Kingfisher owes substantial unpaid dues to fuel suppliers, airports, and lessors. Unable to meet costs and breakeven points, Kingfisher canceled over 200 flights and returned 24 leased aircraft, damaging its brand as a 5-star airline.
Group 10 proposes a financial management project to analyze Kingfisher Airlines' losses since its inception in 2003. Kingfisher invested heavily in expanding its aviation business but was unable to recover operational costs, eroding its net worth. With total debt of Rs. 7000 crores and losses of Rs. 1027 crores in 2011 and Rs. 5690 crores since 2003, Kingfisher owes substantial unpaid dues to fuel suppliers, airports, and lessors. Unable to meet costs and breakeven points, Kingfisher canceled over 200 flights and returned 24 leased aircraft, damaging its brand as a 5-star airline.
(PGP30177); Vishnu Chauhan (PGP30178); Vivekanandan K K (PGP30179) Objective: Like Lockheed, the UB group is a concern that invests in various ventures such as brewing, distilling, real estate, engineering, fertiliser, bio tech and IT. One of their business venture was to enter in the aviation industry though KingFisher airlines. Huge investments were made which could not be recovered and operation cost were not recovered making KF airlines a loss making enterprise since its inception in 2003. This eroded the net worth of the company. Their inability to meet investments forced the company to request its bankers for further credits and an extension to meet their breakeven point. Introduction: Indias aviation sector with the countrys three-listed carriers Kingfisher Airlines, Jet Airways and SpiceJet posting losses in the three months ended 31-Dec-2011 (3QFY2012), traditionally the strongest quarter for Indian carriers, marking four consecutive quarters in the red. Kingfisher Airlines, the airlines of good times owned by the King of good times, posted the heaviest loss among the listed carriers in what was a tough period for Indias aviation sector as a whole. The losses reflect not only issues at the individual carriers but some fundamental and structural challenges in the Indian aviation sector. Kingfisher has a total debt of Rs 7000 Crores even after about Rs 1400 crores was written off. The airline made an operational loss of Rs 1027 Crorein 2011. And the loss since its inception in 2003 of Rs 5690 Crores. It owed approximately 890 crores to all its fuel suppliers. The situation with the fuel is so bad that Indian Oil has put a Kingfisher on a Cash and Carry basis. BPCL and HPCL, the other two suppliers, have stopped supplying fuel completely. BPCL has even filed a court case against Kingfisher Airlines for recovery on unpaid dues of over Rs 250 Crores. it owes the Airports Authority of India, undisclosed landing charges. Both the Bangalore and the Hyderabad airports asked Kingfisher for landing charges before they allow the KF planes to land. It has no assets that it can sell or mortgage as all its aircraft are currently leased. Kingfisher returned more than 24 aircraft as it could not afford the lease amount. Their inability to meet breakeven point and recover costs caused them to cancel over 200 Flights dealing a mortal blow to its image of a 5 star airline.