Airline shares surge on hopes of investment by foreign carriers

Mumbai: Shares of Indian carriers surged in early trades on Tuesday, after the aviation ministry said it would recommend that the government allow foreign airlines to buy stakes of up to 49 percent in Indian airlines.

[caption id=“attachment_185998” align=“alignleft” width=“380” caption=“Reuters”]  [/caption]

At 9:16 am (0346 GMT), Jet Airways was up 6.22 percent at 249.55 rupees, Kingfisher Airlines up 5.98 percent at 26.60 rupees and SpiceJet up 7.38 percent at 24 rupees.

India currently bars foreign airlines from buying into Indian carriers, although foreign investors are allowed to hold a cumulative 49 percent.

India’s loss-making airlines are grappling with high jet fuel prices, low fares, and an economic slowdown. A government decision that is widely expected to open up the sector to foreign carriers would be a lifeline to domestic carriers.

More from Economy

Narendra Modi gets a stellar economic advisory panel but will he listen to it in an election year? Demonetisation: RBI will take time to count scrapped currency note deposits, says Arun Jaitley

Reuters