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New Delhi, Aviation watchdog <keyword id="19899185" type="General" weightage="20" keywordseo="dgca" source="keywords">DGCA</keyword> has deferred the implementation of the revised flight duty norms for pilots that were to be effective from June 1, according to two civil aviation ministry officials. One of the officials on Tuesday said the revised norms have been deferred for some time to have wider consultations. The new norms provide for more rest time for pilots and seek to alleviate pilot fatigue. The latest decision comes less than two weeks after the <keyword id="19926254" type="General" weightage="20" keywordseo="directorate-general-of-civil-aviation" source="keywords">Directorate General of Civil Aviation</keyword> (DGCA) told airlines that the deadline for implementing the revised Flight Duty Time Limitations (FDTL) norms will not be deferred. Another official said implementation of the revised FDTL norms has been deferred for some time to enable thorough consideration of all elements. The <keyword id="20738678" type="General" weightage="20" keywordseo="federation-of-indian-airlines" source="keywords">Federation of Indian Airlines</keyword> (FIA), comprising <keyword id="19896871" type="General" weightage="20" keywordseo="air-india" source="keywords">Air India</keyword>, <keyword id="19987725" type="General" weightage="20" keywordseo="spicejet" source="keywords">SpiceJet</keyword> and <keyword id="19899182" type="General" weightage="20" keywordseo="indigo" source="keywords">IndiGo</keyword>, had written at least twice to the regulator seeking more time for implementation of the revised FDTL norms that were issued on January 8. In a communication to the FIA earlier this month, the regulator said the airlines have to take all necessary steps to roll out the revised FDTL CAR (<keyword id="20777683" type="General" weightage="20" keywordseo="civil-aviation-requirements" source="keywords">Civil Aviation Requirements</keyword>) with effect from June 1, 2024. The revised norms provide for increased weekly rest time to 48 hours for pilots and limit the number of landings to two during night operations. Besides, the night hours for pilots will be extended to cover the period from midnight to 6 am whereas it was midnight to 5 am earlier. Also, all airlines have to compulsorily submit quarterly fatigue reports, which "should follow a non-punitive and confidentiality policy".

DGCA defers implementation of revised flight duty norms for pilots

<ul><li><keyword id="226149" type="PERSON" weightage="20" keywordseo="Publicis-Groupe">Publicis Groupe</keyword> to launch <keyword id="11365319" type="UNKNOWN" weightage="20" keywordseo="pubhub">PubHub</keyword>.</li><li><keyword id="3041295" type="PERSON" weightage="20" keywordseo="Rajesh-Ghatge">Rajesh Ghatge</keyword> takes on additional role of Chief Growth Officer, <keyword id="137598" type="PERSON" weightage="20" keywordseo="Publicis">Publicis</keyword> Groupe India to lead PubHub.</li></ul>Publicis Groupe today announced the launch of PubHub, a comprehensive ecosystem that will create bespoke marketing transformation solutions at scale, through the integration of specialised capabilities across Data, Content, Technology, Production, and Commerce. PubHub will tap into PG India’s established model that is provides seamless services to some of the top global clients across multiple markets. The model has demonstrated success in connecting the people, processes, systems and data needed to fuel marketing transformation in all aspects of design and delivery. It is built to be open source, connecting with tech partners and clients’ partner agencies alike to deliver on client goals better, faster and efficiently. PubHub will be led by <keyword id="1024509" type="COMPANY" weightage="20" keywordseo="Indigo-Consulting">Indigo Consulting</keyword> CEO Rajesh Ghatge, who now additionally takes on the role of Chief Growth Officer, Publicis Groupe India. Ghatge is already leading the implementation of Global Hub for GSK. Last year Publicis won the global production mandate of Circle in partnership with Tag. It is a first-ever model set up to deliver marketing transformation, using data, content, technology and production capabilities and will be servicing close to 90+ brands across 90+ markets. Ghatge has been with the Groupe for close to four and a half years and has close to three decades of experience across marketing and technology. Previously he has launched and built organisations in the space of travel, training and brand activation . Before joining Publicis , he also led a technology-enabled social enterprise which trained and certified school drop-outs to become certified elder care workers. Anupriya Acharya, South Asia CEO, Publicis Groupe says, “Today, the demand for scaled marketing transformation solutions is growing exponentially– on the back of accelerated adoption of digital and tech. For Publicis Groupe, India has emerged as a massive capability centre for digital and tech-led deep expertise across contemporary and innovative marketing and business transformation solutions. Large mandates across global and national brands are being managed across the Groupe in India. The launch of PubHub is timely and apt. With an intrinsic model to scale fast, it has been designed to be agile and responsive while leveraging our proficiency and vast experience across the creative, technology and media competencies.” Rajesh Ghatge said, “As a Client organisation, the choices of agency partners, consulting partners, tools and technologies are immense. These choices are giving rise to one big challenge – that of being able to weave together the right components of creative , data and technology to effectively win in the platform world. Moreover, reclaiming growth has become the number one priority for most enterprises in a dramatically changed world. In this added mandate , I am looking forward to leverage our diverse capabilities and experience to create repeatable and scalable solutions for our clients via PubHub, and fuel significant growth for them.”

Publicis Groupe announces the launch of bespoke marketing service 'PubHub'

<ul><li><keyword id="226149" type="PERSON" weightage="20" keywordseo="Publicis-Groupe">Publicis Groupe</keyword> India is integrating <keyword id="1024509" type="COMPANY" weightage="20" keywordseo="Indigo-Consulting">Indigo Consulting</keyword>’s digital marketing teams with <keyword id="348669" type="COMPANY" weightage="20" keywordseo="Publicis-Worldwide">Publicis Worldwide</keyword>.</li><li>Indigo Consulting will continue as a specialist brand within Publicis Groupe under the leadership of Rajesh Ghatge and Jose Leon; it will keep its focus on <keyword id="3469376" type="COMPANY" weightage="20" keywordseo="Digital-business-transformation">Digital Business Transformation</keyword> (DBT) solutions.</li></ul>Publicis Groupe today announced the integration of Indigo Consulting’s digital marketing teams with Publicis Worldwide, thereby creating a strong 300-member agency capable of providing the entire suite of brand building communication services from strategy to creative across mainline, digital &amp; social, with data at the centre. In turn, Indigo Consulting under the leadership of Rajesh Ghatge (CEO) and Jose Leon (COO) will continue to build on its core strengths and further invest in our deep tech capabilities. Building on its two-decade long experience, and the reputation of being a top-ranked digital transformation company, it will aggressively expand its’ capabilities and strategic alliances across the tech ecosystem to deliver Tech products, and solutions across Enterprise, Experience, Data, Commerce and Marketing domains for the Groupe’s clients. Speaking of the move, <keyword id="937472" type="PERSON" weightage="20" keywordseo="Anupriya-Acharya">Anupriya Acharya</keyword>, Group CEO, South Asia said, “This made imminent sense to us. Communication services are no longer segregated by platforms, i.e., creative agencies for mainline platforms and digital agencies for digital platforms. More and more clients want to work with one agency that can offer holistic strategic &amp; creative solutions to solve their marketing problems. In fact, the pandemic has only heightened the need to have digital at the center of our solutions approach.” <keyword id="212022" type="PERSON" weightage="20" keywordseo="Subhash-Kamath">Subhash Kamath</keyword>, CEO, BBH &amp; Publicis Worldwide said, “I see it as a win-win for everyone. The Indigo digital communications teams have already been working alongside the PWW teams across many of our top clients. By bringing them together under a common leadership, we can now provide our clients a more integrated solution and a more seamless brand custodianship. It’s a transformative move.” Russell Barrett, CEO &amp; Chief Creative Officer, BBH &amp; Publicis Worldwide said, “We need to be absolutely modern and future-facing when it comes to the creative work we produce and digital has to be at the heart of it. I don’t see traditional and digital work needing separate thinking. I want our creative leaders to be able to think across all platforms in answering a brand’s needs. By the coming together of these two teams, it’s a potent force of talent.” Rajesh Ghatge, CEO, Indigo Consulting said, “The tremendous traction that we have got for our digital business transformation and technology practice in the last year has propelled our plan to invest disproportionately to scale this practice. We are making a choice to focus (back) on our DNA. The top ranked digital marketing practice that we had built over the last few years, hence forth being housed in PWW will continue to deliver impactful cross-platform digital marketing solutions for the composite client roster. It is a win– win for our transitioning team, PWW, and our clients."

Publicis Groupe integrates Indigo Consulting’s digital marketing teams with Publicis Worldwide

By Shah Imran Ahmed Mumbai, Mar 24 () Budget carrier IndiGo has assured its employees that it will not make any deduction in their salaries and leaves due to the suspension of domestic flights till March 31 in the wake of coronavirus lockdown.The assurance came a day after the Narendra Modi government issued an advisory to both private and public companies to not lay off employees or cut their salaries, in the wake of the coronavirus crisis.The government's decision to suspend domestic flight till March 31 would come into effect from midnight Tuesday, as part of larger efforts to curb spreading of coronavirus infections.In an e-mail to his employees, IndiGo Chief executive Officer Ronojoy Dutta said the company has "reasonable" level of advanced bookings for April and it was "anxious'' to fly again albeit with a reduced capacity."For those who don't have to be working during this temporary suspension of operations, we will make no deduction of salaries or leaves," Dutta said in the e-mail. has accessed the e-mail.He said that the airline plans to commence the domestic operations from April 1, subject to no further extension of the government order.It may be mentioned here that global aviation consultancy CAPA on Monday said domestic air services are likely to remain suspended beyond March 31 in the wake of the coronavirus pandemic. Later in a statement, he also said that the airline would not be charging any fee for cancelling tickets that are up to April 30, and it would store the ticket price as credit on that PNR, which can be used for alternative booking up to September 30. According to Dutta, IndiGo has reasonable level of forward bookings for April "so we are anxious to start flying again, although it will be a reduced capacity."Stating that the last few days have been very challenging for the airline, he said "clearly for the next few weeks, our revenues will be well below our costs and we will have to make our efforts to penny-pinch and preserve cash".He also said that as employees "let us also be acutely cognizant of the fact that during this temporary suspension of operations, we will be spending our cash reserves to continue to pay salaries and benefits."Once this crisis is over, the airline will have to redouble its efforts to rebuild these cash reserves, Dutta added.The coronavirus has dealt the airline a 'hands of cards' it neither ask for or anticipate, he said."Now it is all up to us employees to play our cards not just well but superbly to restore the full confidence of our customers and share holders trust in us," the airline chief said. Moreover, Dutta, in the statement also stated that those passengers who are booked to travel till September 30, can change their itinerary at zero change fee, for travel up till September 30.The fare difference would have to be paid by the passenger during the time of alternative booking, he said. IAS MKJ

Coronavirus: IndiGo says no deduction in salaries, leaves of employees

<ul><li>At 7:40 am, the SGX Nifty was down 0.53%, indicating a negative start for Nifty50.</li><li>Here’s a list of stocks to watch for in trade today. </li><li><a href="https://www.businessinsider.in/">Check out the latest news and updates on Business Insider.</a> </li></ul>Indian stock-market indices are likely to open in negative territory on Thursday, on the back of subdued cues from the global peers. At 7:40 am, the SGX Nifty was down 0.53%, indicating a weak start for Nifty50. US stocks also tumbled during the afternoon trade as new lockdown restrictions erased morning optimism about Pfizer’s coronavirus vaccine news. The Dow Jones Industrial Average closed 344 points lower, and the S&amp;P 500 was down 1.16%. These are the stocks to watch out for during the trading session today: Pfizer Global drugmakers Pfizer and BioNTech concluded phase 3 study of COVID-19 vaccine candidates and said their COVID-19 vaccine candidate is<a href="https://www.businessinsider.in/science/health/news/pfizers-new-covid-19-vaccine-is-95-effective-and-the-only-severe-side-effect-to-worry-about-is-fatigue-according-to-the-final-results/articleshow/79284286.cms"> 95% effective</a>, including in people over 65 years of age. Based on current projections, the companies expect to produce globally up to 50 million vaccine doses in 2020 and up to 1.3 billion doses by the end of 2021. The shares of Pfizer ended 0.92% lower on Wednesday. TCS The shareholders of Tata Consultancy Services (TCS) said its shareholders have approved its up to ₹16,000 crore share buyback plan.Last month the board of TCS approved a proposal to buyback upto 5.33 crore equity shares at a price of ₹3,000 for an aggregate amount not exceeding ₹16,000 crore. The shares of TCS ended 1.50% lower on Wednesday. Wipro IT services giant Wipro has fixed December 11 as the record date for its ₹9,500 crore share buyback programme. Its board and shareholders have already approved its proposal to buy back upto 23.75 crore equity shares of the company at ₹400 per share. The shares of Wipro ended 0.92% lower on Wednesday. Hero MotoCorp Two-wheeler market leader Hero MotoCorp said it sold more than 14 lakh units of motorcycles and scooters in retail sales during the festive season. Despite severe disruptions due to COVID-19 this year, the good retail off-take during the 32-day festival period — spread between the first day of Navratri and the concluding day after Bhai Duj — was 98% of the festive season volumes sold by the company in 2019 and 103% compared to the same period in 2018. The shares of Hero MotoCorp ended 1.40% lower on Wednesday. Punjab &amp; Sind Bank State-owned Punjab &amp; Sind Bank on Wednesday said the board of the bank would meet later this week to consider raising up to ₹5,500 crore by issuing shares on a preferential basis. The shares of Punjab &amp; Sind Bank ended 0.88% higher on Wednesday. GPT Infra GPT Infraprojects Limited (GPT) has bagged an order valued at ₹162.83 crore from the Hooghly River Bridge Commissioners (HRBC), Transport Department, Government of West Bengal, Kolkata. The contract is for repair and rehabilitation of the second Hooghly Bridge, including replacement of Stay and Holding Down Cables and Bearings etc. The shares of GPT Infra ended 2.09% higher on Wednesday. Lakshmi Vilas Bank Capri Global Holdings sold more than 20 lakh shares of Lakshmi Vilas Bank through an open market transaction. According to the bulk deal data available on the BSE, Capri Global Holdings offloaded a total of 20,55,161 shares at an average price of ₹12.40 apiece. This took the total deal value to ₹2.54 crore. The shares of Lakshmi Vilas Bank ended 20% lower on Wednesday. IndiGo According to the air regulator DGCA data, IndiGo passenger load has increased from 65.4% in September to 68.2% in October. IndiGo holds 55.5% market share in Indian skies. The shares of IndiGo ended 5% higher on Wednesday. SpiceJet According to the air regulator DGCA data, SpiceJet passenger load has increased from 73% in September to 74% in October. SpiceJet holds 13.4% market share in Indian skies. The shares of SpiceJet ended 13% higher on Wednesday. SEE ALSO:<a href="https://www.businessinsider.in/stock-market/news/dow-tumbles-345-points-as-fresh-lockdown-measures-overshadow-vaccine-progress/articleshow/79292917.cms" data-type="tilCustomLink"> Dow tumbles 345 points as fresh lockdown measures overshadow vaccine progress</a> <a href="https://www.businessinsider.in/science/health/news/pfizers-new-covid-19-vaccine-is-95-effective-and-the-only-severe-side-effect-to-worry-about-is-fatigue-according-to-the-final-results/articleshow/79284286.cms" data-type="tilCustomLink">Pfizer's new COVID-19 vaccine is 95% effective and the only severe side-effect to worry about is fatigue, according to the final results</a>

Top stocks to watch — Pfizer, TCS, Wipro, Hero Moto, Lakshmi Vilas Bank, SpiceJet, IndiGo, and others

<ul><li>IndiGo and GoAir’s flights to Port Blair with their Airbus A320neo have been banned. </li><li>Both airlines use Pratt &amp; Whitney engines, which have caused many mid-air scares. </li><li>However, the government has allowed the airlines to operate all other flights. </li></ul>After multiple <a href="https://scroll.in/latest/909908/indigo-goair-barred-from-flying-airbus-a320neo-aircraft-to-port-blair">mid-air scares</a> and incidents of <a href="https://www.business-standard.com/article/news-ians/pw-initiates-steps-to-fix-smoke-trouble-with-engines-after-indigo-incident-118121901355_1.html">smoke</a> inside flights, the Directorate General of Civil Aviation, the regulatory body under the civil aviation ministry has now banned IndiGo and GoAir from flying their Airbus A320neo aircraft to Port Blair. The ban extends to flying the Airbus A320neo aircraft to any other overseas route, where an alternate landing option is more than an hour away, should one of the engines develop a snag. “This restriction has been imposed for safety reason as there must be an airport within one hour of flying time during entire journey of A320neo with PW engines so that the plane can safely land at the nearest alternate on a single engine when one engine develops a snag,” a senior regulatory official told <a href="https://timesofindia.indiatimes.com/business/india-business/dgca-bars-indigo-goair-from-flying-planes-with-pw-engines-to-port-blair-or-long-overseas-routes/articleshow/67576407.cms">The Times of India</a>. For some time now, there have been complaints about the Pratt &amp; Whitney engines in the aircraft. Despite the risks, flights continue to operate on all other routes within India without any restrictions. “We have proactively complied with the <keyword id="6354787" type="ORGANIZATION" weightage="20" keywordseo="DGCA">DGCA</keyword> circular,” IndiGo said in response to queries from Business Insider. Currently, IndiGo operates over 40 A320neo aircraft, while GoAir has 30 of the said aircraft. “If it is risky flying an aircraft with engines having a high rate of in-flight shutdowns, then it’s much better you don’t fly it, as a precaution to avert a catastrophe. Unfortunately, airlines will have a hard time keeping things going from a network perspective, and (it) would mean a significant revenue hit, for sure,” Mark Martin, CEO of aviation consultancy firm Martin Consulting told Quartz in March 2018. Jayant Sinha, the junior minister for civil aviation, met with DGCA authorities on January 8 to take stock of the risks with Pratt and Whitney engines, following a glitch on an IndiGo flight from Kolkata to Chennai. The DGCA reportedly decided to review the performance of Airbus A320 aircraft fitted with the P&amp;W 1100 series engines. In November 2018, an IndiGo Hyderabad-Port Blair flight had <a href="https://www.timesnownews.com/india/article/another-scare-for-passengers-indigo-plane-engine-fails-mid-air-aircraft-tilts-heavily-towards-one-side/318839">reportedly</a> suffered engine failure right after take off and had to go for an emergency landing. However, the aviation company declined to have had any such incident and called it “false news”. GoAir is yet to respond to BI’s queries on the ban, and on the findings revealing issues with the engines. See Also: <a href="https://www.businessinsider.in/flights-with-pratt-and-whitney-engines-can-fly-pending-more-dgca-directives/articleshow/67456667.cms">India allows flights with erratic engines pending more safety directives</a> <a href="https://www.businessinsider.in/the-indian-government-is-planning-to-sell-its-struggling-national-carrier-for-1-billion-next-year-a-much-lower-price-than-it-had-initially-hoped-for/articleshow/67470424.cms">The Indian government is planning to sell its struggling national carrier for $1 billion next year — a much lower price than it had initially hoped for</a> <a href="https://www.businessinsider.in/jet-airways-revival-delayed-by-etihads-hard-bargain/articleshow/67567581.cms">Jet Airways’ revival delayed by Etihad’s hard bargain</a>

India is allowing flights with faulty engines to fly anywhere – except one city

<ul><li>The country’s airlines are set to lose nearly $2 billion in 2018-19, according to CAPA, a consultancy, owing to rising costs and low fares. </li><li>The Ministry of Civil <keyword id="31907" type="COMPANY" weightage="20" keywordseo="Aviation">Aviation</keyword> is working on a relief package to ease the cost pressures on the country’s struggling carriers. This could involve a reduction in <keyword id="4869" type="PERSON" weightage="20" keywordseo="Fuel">fuel</keyword> taxes by bringing aviation turbine fuel under the GST regime. </li><li>The government also wants to build 100 new airports within the next 15 years. </li></ul>A relief package has been a long time coming for the world’s third largest aviation market. While India’s airlines have expanded their business rapidly over the past decade, as indicated by surging passenger traffic, much of this has come with high capital costs and minimal profits. And now? Airlines are recovering from one of the worst years so far in recent memory. The rupee’s depreciation is expected to raise costs for airlines, most of which are denominated in dollars like leasing expenses and ground handling charges overseas, by a third. Fuel costs, which comprise 40% of overall costs, have risen dramatically amid a rebound in oil markets and heavy domestic duties. Fares have stayed low in the face of a intense competition in order to keep passenger volumes robust. The losses are mounting. For the first quarter of the current financial year, <keyword id="6358200" type="DOMAIN" weightage="20" keywordseo="jet-airways">Jet Airways</keyword> and <keyword id="6358032" type="DOMAIN" weightage="20" keywordseo="SpiceJet">Spicejet</keyword> and reported net losses of ₹13.2 billion and ₹380 million, respectively, while <keyword id="6354706" type="DEFINITION" weightage="20" keywordseo="IndiGo">Indigo</keyword>, which has usually been the country’s most profitable airline, saw a 97% drop in its net profit to ₹280 million. The country’s airlines are set to lose <a href="https://timesofindia.indiatimes.com/business/india-business/indian-airline-losses-could-reach-1-9-billion-this-year-capa-india/articleshow/65666776.cms">nearly $2 billion </a>in 2018-19, according to CAPA, a consultancy, and will need a $3 billion capital injection to clean up their balance sheets. A lifeline from the government The government has taken notice of the problems faced by the sector. According to the civil aviation secretary, RN Choubey, the Ministry of Aviation is working on a rescue programme for the country’s struggling carriers. While the details of the package have not been announced, the aviation ministry has been working with the finance ministry to ease some of the cost pressures on airlines. The package will likely focus on two things- high fuel prices and the problem of the rising rupee, especially in relation to leasing costs. For the former, the aviation ministry plans to bring aviation turbine fuel (ATF) under the GST regime as opposed to the current system, whereby states impose different taxes on top of a national excise duty of 14%. No discussion of the industry’s problems is complete without mentioning the travails of Air India. The loss-making, indebted state carrier is also slated to receive a minor reprieve from the government in order to stay afloat in the short-term. The Indian government has extended a credit facility <a href="https://www.businesstoday.in/sectors/aviation/govt-to-infuse-rs-2100-crore-into-air-india/story/281976.html">of ₹21 billion</a> to Air India for working capital purposes, following an equity infusion of ₹8.6 billion. The government is also planning to invest heavily in airports infrastructure. Earlier this week, the Minister of Aviation, <keyword id="6356597" type="PERSON" weightage="20" keywordseo="suresh-prabhu">Suresh Prabhu</keyword>, announced that the government would finance the construction of 100 airports in the country over the next decade and a half, to add to India’s 130 existing airports. The programme is expected to cost around $60 billion.

The Indian government is planning a rescue package for the aviation sector as the losses pile up

<ul><li><keyword id="2573" type="CITY" weightage="20" keywordseo="Air-India">Air India</keyword>’s debts are reported to be as high as ₹ 700 billion. </li><li>The airlines might lose $1-2 billion in FY19/FY20, says CAPA, a consulting firm. </li><li>Deadline for bids extended till 31 May 2018.</li></ul>Air India (AI) may have to shut down based on the findings of aviation consulting firm CAPA India. The bleeding airline went up for sale on 28 March 2018. AI’s debt was ₹520 billion as of <a href="https://qz.com/1239614/air-india-sale-government-offers-new-owner-full-control-and-half-the-debt/">fiscal 2017</a> but the <a href="https://timesofindia.indiatimes.com/business/india-business/air-india-sale-off-to-begin-with-airline-arm-other-three-units-to-follow-suit/articleshow/63199280.cms">report finds</a> this could be as high as ₹700 billion. @capa_india tweeted, 
 
 
 
 
 
 
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 On March 28, the Indian government had issued a Preliminary Information Memorandum (PIM) inviting Express of Interest (EoI) for the strategic divestment of AI, along with the airline's shares in AIXL (Air India Express) and AISATS (Air India SATS Airport Services) from private entities including the airline's employees. The central government currently owns 100% equity of Air India. In turn, the airline holds full stake in Air India Express and 50% stake in the joint venture AISATS. The government has planned to <a href="https://www.ndtv.com/business/air-india-might-shut-down-if-divestment-bid-fails-capa-india-1847715?pfrom=home-business">divest 76% of the its stake in AI</a>, 100% in AIXL and 50% in AISATS. 
 
 
 
 
 
 
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 CAPA also predicted that AI will be at a loss of approximately $2 billion for fiscal 2019 and 2020. All the big players of the airline industry, including <keyword id="832409" type="COMPANY" weightage="20" keywordseo="The-Tata-Group">the Tata Group</keyword>, <keyword id="6354706" type="DEFINITION" weightage="20" keywordseo="IndiGo">Indigo</keyword> and <keyword id="6358200" type="ORGANIZATION" weightage="20" keywordseo="jet-airways">Jet Airways</keyword>, have <a href="https://economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/why-potential-buyers-are-dropping-out-of-air-india-sale/too-much-debt-and-no-clarity/slideshow/63714845.cms">reportedly</a> already backed off due to the huge debt and no clarity on the terms offered by the government. The government has extended the submission for the EOI bids of AI divestment process to 31 May 2018.

India’s flagship airline may be shutting down if divestment bid fails

<ul><li>Both Jet Airways and <keyword id="6354706" type="DEFINITION" weightage="20" keywordseo="IndiGo">Indigo</keyword> have said that they won't be submitting bids for the debt-laden national carrier.</li><li>The deal comprises the purchase of a 76% stake in <keyword id="2573" type="CITY" weightage="20" keywordseo="Air-India">Air India</keyword> and also includes ₹334 billion of the company's debt. </li><li>If the government doesn't receive any bids by May 14th it will have no choice but to revise the terms of the <keyword id="44532" type="PERSON" weightage="20" keywordseo="Disinvestment">disinvestment</keyword>. </li></ul> The <keyword id="44734" type="ORGANIZATION" weightage="20" keywordseo="Indian-Government">Indian government</keyword>’s plans to privatise Air India have been dealt a huge setback as both Jet Airways and Indigo have said that they will not be submitting bids for the debt-laden national carrier. It’s been close to a fortnight since the government formally kicked off the disinvestment process by<a href="http://www.civilaviation.gov.in/sites/default/files/PRELIMINARY%20INFORMATION%20MEMORANDUM.pdf"> inviting expressions of interest</a> for a 76% stake in Air India, but there is still no sign of a guaranteed bid. Jet Airways, India’s second-largest domestic airline, was reported to be mulling a joint bid with Air-France KLM and Delta but was likely scared away by the high level of debt it would inherit from the purchase as well as additional deal terms. The company, which is dealing with debt problems of its own, would have been unable to submit an individual bid given its negative net worth. The Indian government has a number of key conditions for the disinvestment process. First, it will retain a 24% stake in Air India. Second, it will offload around ₹334 billion of the carrier’s debt burden of around ₹488 billion (as of March 2017) to the buyer. Third, in order to be eligible, a prospective buyer needs to have a net worth of ₹50 billion and must have reported a net profit thrice in a row in the last five years. If a domestic airline, doesn’t fulfill these requirements it will have to solicit partners for a joint bid and take a stake of 51% or less. Fourth, a prospective buyer has to submit a combined bid for Air India’s domestic and international businesses, its low cost carrier, Air India Express, and a 50% stake in its airport services unit, Air India SATS. Finally, the buyer will not be able to exit its stake for three years, after which it might have to take Air India public through an IPO- a requirement that hinges on a successful turnaround. “Considering the terms of offer in the information memorandum and based on our review, we are not participating in the process,” Jet Airways’ deputy CEO, Amit Agarwal, told media outlets. Similarly, Indigo, India’s largest domestic airline, was said to be preparing a bid with Qatar Airways but the former ruled out a bid last week as the government’s terms of the disinvestment would have required it to bid for Air India’s domestic arm. The airline, which operates seven international routes, was primarily interested in Air India’s international operations as well as Air India Express, but would not have been able to bid for them separately. Indigo’s president Aditya Ghosh cut straight to the point when he said that the company did not have the ability to turn Air India’s fortunes around. So how grim is Air India’s state of affairs? In addition to its mounting debt, the national airline hasn’t reported a profit since 2007, when the Congress government ordered it to merge with another state-backed carrier, Indian Airlines. It made a net loss of nearly ₹58 billion in fiscal 2017. After commanding a near monopoly in India’s aviation market, its market share has shrunk to 12% of domestic flights and 17% of international flights. Furthermore, the airline’s employees stage strikes at regular intervals over the non-payment of salaries, the ticket booking service on its website is beset with glitches and its flights are routinely delayed or cancelled. After bailing the airline out to the tune of ₹300 billion in 2012 as part of a failed turnaround effort, it is clear that the government is out of options. However, the airline isn’t a completely lost cause. It has landing rights and space at a number of major international airports such as London’s Heathrow and New York’s JFK as well as prime spots at India’s domestic airports. It flies to 43 international and 54 domestic locations and operates a fleet of 138 aircrafts, 62% of which it owns outright. Two of its subsidiaries, Air India Express and Air India SATS, are profitable and the deal includes 21.5 acres of hangar space and land at the Delhi and Mumbai airports. So are there any potential bids on the horizon? Both Swiss Aviation Consulting, an advisory firm, and Singapore Airlines, which operates Vistara with Tata Sons, are said to be interested in purchasing a stake in Air India, the former on a larger client’s behalf. However, this is just hearsay at this point. Also, foreign bidders could steer away altogether from a purchase given the prospect of government interference and a 49% cap on foreign ownership. The government has earmarked May 14th as the final date for the submission of expressions of interest. It does not plan to extend this deadline. The names of the qualified bidders will be announced on May 28th. The aviation ministry <a href="https://economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/still-waiting-to-see-if-indigo-bids-for-air-india-government/articleshow/63685125.cms">still has its hopes</a> pinned on a bid from Indigo, although that looks highly unlikely. If the government receives one bid, or worse, none at all, it will have no choice but to revise the terms of the disinvestment. In all probability, it will offer Air India’s businesses for sale on a piecemeal basis and trim down the level of debt that prospective buyers will inherit. The disinvestment of Air India is a major step in the Modi administration’s drive to reform and/or privatise the country’s public-sector institutions. The government will do its best to ensure a sale goes through. At this point, any deal is better than none at all.

No one seems interested in buying Air India

Despite low crude oil prices, some of the airlines in India are still bearing rough weather. As per a report by aviation consultancy Capa India, Indian airlines have lost more than $10 billion since 2009 while their debt stands at around $11.3 billion. 
 
But, IndiGo, which has 40% share of the Indian aviation market, remains unaffected and is managing its business with aplomb. 
 
Here are few reasons for how the budget airline is prospering in tough times. 
 1. <keyword id="2399048" type="UNKNOWN" weightage="20" keywordseo="IndiGo-IPO">IndiGO IPO</keyword>: When IndiGo’s operator <keyword id="300127" type="COMPANY" weightage="20" keywordseo="Interglobe-Enterprises">InterGlobe Enterprises</keyword> announced their plans for an IPO and set prices between Rs 700 and Rs 765 a share, many though the prices were too high. But, IndiGO IPO subscribed more than six times and made a stunning debut on the market, gaining early 18% on listing. IndiGo is now valued at around $6 billion. 
 
2. Keeping it simple: Despite complex aviation regulations, creaking airports, rising airport fees, exorbitant taxes, etc, IndiGo has stuck to one formula-keep it simple. "We focus only on getting customers from point A to B safely along with their bags and serve food that will not make them sick," IndiGo president Aditya Ghosh had said. IndiGo flies only the Airbus320s, which helps keep operations simple and costs low. 
 
3. Negotiations: Through repeated orders of Airbus 320, (100 planes in 2005, 180 in 2011 and 250 planes in October) have given IndiGo an edge to bargain hard. IndiGo then sells and leases back the planes, cushioning its balance sheet from the uncertainties of aviation and helping it retain a young fleet. 
 
(Image: Indiatimes)

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