Rakesh Jhunjhunwala’s new bet: Ultra-low cost airline with 70 planes

Billionaire Investor Rakesh Jhunjhunwala plans to have 70 aircraft within four years for new airlines he wants to arrange in India on optimism more people will travel with air.

Jhunjhunwala, who is considering investing $ 35 million and will have 40% of the operator, hoping to obtain a certificate without objections from the Indian airline ministry in the next 15 days, he said in Bloomberg television interviews. The airline is very low, it will be called a water and team, which includes former Senior Delta Air Lines Inc. executive, looking at a plane that can carry 180 passengers, he said.

This is a bold bet by Rakesh Jhunjhunwala, known locally as Warren Buffett India, in the market that has seen several airlines collapsing in the face of a great tariff war and high costs. However, what was once the fastest growing flight market in the world holding the attraction and Jhunjhunwala was looking at the opportunity to seduce leaflets with new aircraft carriers offering low rates.

“For corporate culture to be economical, you have to start,” Jhunjhunwala said. “I am very, very bullish in the Indian aviation sector in terms of demand.”

Even before the pandemic, the airline in India struggled. Kingfisher Airlines Ltd., once the second largest domestic operator in the country, ended operations in 2012, and Jet Airways India Ltd. which was recently approved to fly again, collapsed in 2019.

While demand for air travel has been hit globally, the Indian aviation industry is at a greater risk of being delayed recovery as the threat of the third wave of infection of looms. The airline felt the impact.

Vistara, owned by Singapore Airlines Ltd together with Tata Group conglomerate, in discussions with Boeing Co. and Airbus SE to delay aircraft delivery and make changes to the payment schedule. Indigo, the largest airline in India, reported a better loss than anticipated because Covid disorders wrinkled their income.

It did not prevent Jhunjhunwala, which according to Forbes had a net worth of approximately $ 4.6 billion.