Jet to dilute 10 pc of equity, hike fares

Mumbai, September 29 : Private carrier Jet Airways is looking at diluting 10 per cent of its equity to international funds, but if the market conditions are favourable, the equity dilution could be extended to 15 per cent.

Jet chairman Naresh Goyal, told reporters at the sidelines of the 16 th annual general meeting that the airline will also increase airfares by next month. The airline will also invest nearly $1 billion over the next three years towards purchase of five A-330s and three Boeing-777s.

Addressing the shareholders, Goyal said, "It has been estimated that the losses incurred by the aviation sector during the 2007-08 fiscal stood at Rs 4,000 crore and is expected to double during the current fiscal." The cost of aviation turbine fuel (ATF) is nearly 60 per cent higher then the international prices. If the central and state governments remove the burden of high tax structure from the sector, there will be some benefit for the airlines, he said.

Replying to questions by the shareholders, KG Vishwanath, senior general manager, MIS and investor relations, said that the airline is in talks with private Oil companies for the supply of ATF subject to legal procedures to achieve cost efficiency. "The airline will soon add newer international destinations to its existing network like Saudi Arabia and Jeddah on the Gulf route," he said.

Vishwanath also added that the two simulators installed by the airline have bought down their pilot training cost by nearly $8-10 million. Previously, the airline sent its pilots abroad for training purposes. "Our captive consumption of the simulators is 70 per cent and the rest can be given to other airlines to meet their training requirement," said Vishwanath.

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