Big Bull and billionaire, Rakesh Jhunjhunwala, is planning to invest in an airline startup, named Akasa Air, which could allegedly take to the skies by this year or early next, as predicted.
The ace investor looks forward to invest $35 million and own 40% stake in the ultra-low cost airline startup, with a fleet of 70 aircrafts in 4 years, which will majorly aim to cater the economy class.
Next to join hands with Jhunjhunwala are former Indigo President Aditya Ghosh, who plans to hold near about 10% stake and former Jet Airways boss Dube will own over 15 per cent and be the airline’s CEO.
The hard hit aviation industry is expected to bounce back to pre-pandemic levels by 2023 only. However, lost cost domestic airlines had already started to show demand just after the second wave. In fact, in an interaction earlier this week, IATA Director General Willie Walsh said the Indian government should take data driven decisions and remove regulations which restrict capacity and access to allow aviation industry to recover quickly.
Jhunjhunwala, currently awaiting a green signal from the Aviation Ministry, is stepping in the industry at a time when major airlines have barely started to keep their margins and even had to take cost cutting measures like firings or pay cuts in 2020.
Commenting on the same, Rakesh said,”For the culture of a company to be frugal you’ve to start off fresh. I am very, very bullish on India’s aviation sector in terms of demand. I think some of the increment players may not recover. I have got some best airline people in the world as my partners.”
India was the fastest growing aviation market globally before the coronavirus pandemic and had almost doubled air passenger traffic from 2014 to 2018.
In other good news for the aviation industry, two more commuter airlines are in their final stages of certification, Big Charter and Aviation Connectivity, and a plan to revive Jet Airways is already in process. Many other airlines are lined up to enter the Indian aviation industry.
Moreover, Jyotiraditya Scindia has recently been appointed as the union civil aviation minister and he faces the challenge of getting one of the most hard hit industry in India to get back on its feet, but only time will tell how the industry fares under his watch.