Mumbai International Airport may now slap an eviction notice on the cash-strapped airline, owned by Vijay Mallya and lease out the space to other carriers
Mumbai: In fresh trouble for beleaguered Kingfisher Airlines, Mumbai International Airport Ltd (MIAL) may issue an eviction notice after the grounded carrier failed to respond to an earlier notice asking it to clear the Rs22 crore dues towards parking and navigational charges, reports PTI.
The notice for clearing the dues, served 10 days ago, gave the airliner 7 days time to make the payment but it has not yet responded, MIAL sources told PTI on Monday.
"We have yet to hear from Kingfisher Airlines on our notice. They were given seven days time to clear our dues and so far neither they have responded to the notice nor have made any payment," sources said speaking on condition of anonymity.
They said the airport operator may now slap an eviction notice on the cash-strapped airline and lease out the space to other carriers.
The Vijay Mallya-owned carrier has been grounded since 1st October and its flying license suspended.
The airport has two terminals. While national carrier Air India and Kingfisher (before being grounded) operate from Terminal A, the rest including Jet Airways, SpiceJet, IndiGo and GoAir, operate from Terminal B.
With Kingfisher unlikely to take off in the immediate future, the airport is negotiating with other carriers to allocate them the space hitherto occupied by the Mallya-owned airline.
"Discussions are going on but we have not taken a final call," the sources said.
Kingfisher has been grounded since 1st October following a strike by its pilots and engineers over non-payment of salary dues. The strike was called off on 24th October after the airline management assured them payment of their dues for March, April and May in a staggered manner by Diwali.
Though, it managed to pay for March and April, the carrier failed to pay the May salary to most employees barring those drawing under Rs20,000 per month.
Effectively, the airline has not paid salaries to most of its 4,000 employees since May.
On 19th October, in the middle of the strike, aviation regulator DGCA suspended its flying license.
The airline has a bank credit of Rs7,000 crore and the unpaid interest since January this year thereon, apart from over Rs10,000 crore of accumulated losses since its launch in May 2005.
A consortium of 17 lenders, led by State Bank of India, had set a 30th November deadline to bring in additional capital to the tune of at least Rs5,000 crore as a pre-condition to consider the airline's request for more working capital loan. However, there has been no word from the company about the bankers' demand.
RBI has become more mindful of growth risks and it is unlikely to shift from its anti-inflationary stance till inflation peaks out, says a Kotak Economic Research report
Despite slowing further to 5.3% in 2QFY13 from 5.5% the previous quarter, economic activity is stabilizing at current levels and is likely to see a saucer-shaped recovery going ahead, according to a Kotak Economic Research report on the Indian economy today. The Kotak report maintains its FY2013 GDP estimate at 5.6%, with slight improvement in FY2014 to 6.2%.
According to the Kotak report, even as the RBI (Reserve Bank of India) has possibly become more mindful of growth risks, it is unlikely to shift from its anti-inflationary stance till inflation peaks out. Hence, Kotak does not expect any policy action in the 18 December 2012 mid-quarter policy meeting.
The Kotak report observes that liquidity in December is likely to remain tight given:
(1) advance tax outflows,
(2) continued wedge between credit-deposit, and
(3) likely pick-up in currency in circulation due to state elections.
With the RBI resuming OMOs (open market operations) for liquidity management, the possibility of a CRR cut in the December meeting has significantly reduced but a final call can be taken closer to the policy meeting, says the Kotak analyst.
On the agriculture sector, the Kotak report says that the full impact of a likely sub-par kharif harvest would be felt in 3QFY12 with a contraction in agriculture growth acting as a drag on growth. It expects agriculture sector growth to fall sharply to 1% in FY2013 from 2.8% in FY2012 and pick up to 2.0% in FY2014, helped by low base effect and expectation of a normal monsoon.
The Kotak report does not expect much recovery in the capex cycle and consequently expects the industrial sector to register a muted growth of 1.7% in FY2013.
Lastly, the Kotak report observes that the drop in government spending in the current quarter may further impact the private consumption slowdown. Private consumption has been slowing (3.7% in 2QFY13 compared to 4.0% in 1QFY13) partly due to sustained high inflation. It does not expect dramatic downward correction as rural wages continue to remain strong, although slowing, keeping rural consumption relatively insulated. It expects the services sector growth to be at 7.6% in FY2013 against 8.5% in FY2012.
For those long, watch out if Nifty closes below the previous day’s low
The Indian market, after witnessing a 4.5% gain in November, started the new month on a subdued note as it snapped its four-day winning streak as cautiousness prevailed ahead of the crucial vote in Parliament on the government’s recent reforms. On Friday we had mentioned that we continue to see the uptrend remaining firm, however, for those long, watch out if Nifty closes below the previous day’s low for a reversal in trend. The National Stock Exchange (NSE) saw a volume of 82.74 crore shares and an advance-decline ratio of 905:549.
The market opened flat as investors preferred to wait and watch as the political events unfold this week which will have a bearing on the reforms programme of the UPA government. The Nifty opened two points down at 5,878 while the Sensex started off the day at 19,343, up three points over its previous close.
The HSBC India Manufacturing Purchasing Managers’ Index (PMI)—a measure of factory production—stood at 53.7 in November, up from 52.9 in October. The November data marks the fastest pace in five months, driven by a strong pick up in new orders and improved purchasing activity.
The manufacturing data lifted the market to the day’s high in early trade with the Nifty rising to 5,899 and the Sensex going up to 19,416. However, profit taking after the recent four-day rally saw the benchmarks dipping into the negative in the first hour.
The indices were range-bound in morning trade in the absence of any triggers. The market made a feeble attempt to emerge into the green in noon trade, but the move was shot down by sellers.
The benchmarks remained in the negative in the post-noon session as cautiousness prevailed ahead of the vote in Parliament on the FDI issue. The market touched its lows around 2.45pm with the Nifty falling to 5,855 and the Sensex going down to 19,257.
The market ended its four-day winning streak and closed in the red, but off the lows on the back of a minor recovery in late trade. The Nifty settled nine points lower at 5,871 and the Sensex finished the day at 19,305, down 35 points from its previous close.
While the Sensex closed marginally lower, the broader indices closed with good gains. The BSE Mid-cap index surged 1.21% and the BSE Small-cap index climbed 0.86%.
The top sectoral gainers were BSE Realty (up 1.35%); BSE Metal (up 0.80%); BSE Power (0.65%); BSE Consumer Durables (up 0.55%) and BSE Oil & Gas (up 0.47%). The losers were BSE Bankex (down 0.40%); BSE Fast Moving Consumer Goods (down 0.34%) and BSE TECk (down 0.14%).
Thirteen of the 30 stocks on the Sensex closed in the positive. The main gainers were BHEL (up 1.59%); State Bank of India (up 1.53%); Tata Steel (up 1.36%); Reliance Industries (up 1.23%) and Mahindra & Mahindra (up 1.15%). The top losers were HDFC Bank (down 2.37%); Bharti Airtel (down 1.76%); GAIL India (down 1.06%); ONGC and NTPC (down 0.89% each).
The top two A Group gainers on the BSE were—Videocon Industries (up 12.22%) and CRISIL (up 10.39%).
The top two A Group losers on the BSE were—Tata Communications (down 3.69%) and HDFC Bank (down 2.37%).
The top two B Group gainers on the BSE were—Punjab Communications (up 19.98%) and Syncom Healthcare (up 19.79%).
The top two B Group losers on the BSE were—MIC Electronics (down 12%) and Aarya Global Shares & Securities (down 11.80%).
Out of the 50 stocks listed on the Nifty, 23 stocks settled in the positive. The major gainers were ACC (up 3.87%); UltraTech Cement (up 3.01%); SBI (up 1.83%); RIL (up 1.68%) and Jaiprakash Associates (up 1.51%). The key losers on the index were HDFC Bank (down 2.44%); IDFC (down 2.28%); Bharti Airtel (down 1.82%); GAIL (down 1.49%) and ONGC (down 1.28%).
Markets in Asia closed mixed as positive manufacturing data from China boosted some indices while concerns about the US fiscal woes pressurised others. The HSBC China manufacturing Purchasing Managers’ Index (PMI) rose to 50.5 in November from 49.5 in October. This is the first time since October 2011 the headline number has topped the 50-point line that differentiates growth and contraction. Meanwhile, US lawmakers are discussing the budget to help avert the “fiscal cliff”. Failure to come up with a budget deal would trigger more than $600 billion of automatic tax increases and spending cuts next year.
The Shanghai Composite dropped 1.035; the Hang Seng tanked 1.19%; the KLSE Composite declined 0.22% and the Straits Times fell 0.14%. Among the gainers, the Jakarta Composite advanced 0.62%; the Nikkei 225 rose 0.13%; the Seoul Composite gained 0.37% and the Taiwan Weighted settled 0.26% higher.
At the time of writing, the key European indices were trading with gains and the US stock futures were marginally in the positive.
Back home, foreign institutional investors were net buyers of shares totalling Rs1,611.43 crore on Friday whereas domestic institutional investors were net sellers of equities amounting to Rs798.63 crore.
Media firm Jagran Prakashan (JPL) today said its board has approved to raise up to Rs150 crore through issue of securities to augment its resources as well as to retire debt. The company plans to use the proceeds to augment its long-term resources and retire its high interest bearing short-term debt. The stock gained 2.01% to settle at Rs104 on the NSE.
United Bank of India today said it proposes to raise Rs 300 crore from bonds to fund its business growth. The bank has finalised the issue of unsecured, non-convertible, perpetual debt instrument of Rs1 lakh each at par for an amount of Rs200 crore with a green shoe option of another Rs100 crore on private placement basis, United Bank of India said in a filing on the BSE. The stock closed 1.41% higher at Rs75.60 on the NSE.
Private carrier Jet Airways today said it has expanded its code-share arrangement with Japan’s All Nippon Airways. The code-share with Nippon offers travellers enhanced network connectivity between Japan and India, a Jet Airways release said, adding that the arrangement will enable both Jet Airways and All Nippon passengers to fly between Tokyo and Osaka to various points across India on connecting flights operated by both carriers. The stock jumped 5.36% to close at Rs555.30 on the NSE.