Kingfisher Airlines stock goes into a tailspin

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Kingfisher Airlines stock goes into a tailspin
The Kingfisher Airlines stock went into a complete tailspin losing 12% to trade at Rs 23.50, at 10 am IST. The stock opened lower and at one stage in early morning trade was down as much as 18%.

Reports of flights being cancelled and continued woes at the company have affected the stock adversely. Marketmen do not expect the stock to recover anytime soon, and are advising to sell the stock. The company is already saddled with huge debts and it is unlikely that the industry is going to get any respite from taxes and high aviation turbine fuel, which will continue to aggravate woes at Kingfisher Airlines.

With crude continuing to remain at elevated levels, Kingfisher is likely to be impacted adversely. The government has made it clear that there is unlikely to be a bailout package for private sector airlines.

Already, the government has to content with mounting losses at Air India and a growing fiscal deficit., that has put pressure on government finances.

All eyes would now be focused on banks that are major lenders of Kingfisher Airlines, including its largest lender State Bank of India. A restructuring of debts remains paramount, in order to enable the airline continue to fly.

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