Kingfisher stock tumbles over safety concerns

Stocks

oi-Sneha

By Sneha B K

Published: Friday, January 6, 2012, 13:12 [IST]

India's troubled Kingfisher Airlines shares dropped more than 6% on Bombay Stock Exchange on Friday morning as investors' confidence tumbled after State Bank of India (SBI), the major creditor of Kingfisher Airlines titled the airline as Non Performing Asset (NPA).

Investors also expressed concerns over company's safety standards. However, Kingfisher denied safety was compromised.

At 1.00 pm IST shares were seen trading at 19.10 down by 1.35 points or 6.60%.while the share had also touched an intraday low of Rs 18.25, during the morning trade.

Yesterday, cash-strapped Kingfisher airlines slipped as much as 5% on Bombay Stock Exchange after the news spread that the airline is planning to go for Job-cut which was another blow over the stock of the company. Kingfisher Airlines is planning to cut around 2,000 jobs, in an effort to reduce the number of zeros in its debt obligations, as per a media report.

On Thursday, The Times of India reported that the Directorate General of Civil Aviation (DGCA) has warned airline that its license could be under threat if it does not come back with a detailed plan of financial recovery and safety.

Kingfisher Airlines is in financial crisis and Chairman Vijay Mallya airline baron is struggling for the hold. The company's shares has tumbled in recent months in a bid to stem high debt and company's inability to meet cash crisis.

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