 "Azim Premji, Ranjan Pai family offices infuse capital into Akasa Air")
Akasa Air, which began operations in August 2022, announced on Thursday that it has signed agreements with investors, including Premji Invest, Ranjan Pai's investment office, and 360 ONE Asset, to infuse fresh capital into the airline.
The Jhunjhunwala family, which already holds about 40 per cent stake in the airline, has also committed to infuse additional capital into the airline, it mentioned. The airline did not disclose the investment amount or the stake to be sold. However, sources indicated it plans to raise about $125 million.
The airline’s net loss more than doubled in 2023-24, soaring to Rs 1,670 crore from Rs 744 crore in the previous year. Meanwhile, its total income saw a sharp rise, reaching Rs 3,144 crore in 2023-24 compared to Rs 778 crore in 2022-23.
In a statement on Thursday evening, the airline said: "A consortium of India’s finest investors, including Premji Invest—the global investment arm of Azim Premji—Claypond Capital, the investment office of Ranjan Pai, and funds managed by 360 ONE Asset, a leading asset management firm, has signed investment agreements with Akasa Air. Independently, the Jhunjhunwala family has also committed to an additional capital infusion into Akasa Air... The investment transactions now await requisite regulatory approvals."
In January last year, Akasa Air placed an order for 150 B737 Max aircraft with American planemaker Boeing, adding to the 76 Max planes it had ordered earlier. Of the 76 planes, 27 have already been delivered to the airline. The funds raised will help the airline pay for the new planes, sources mentioned. While the Jhunjhunwala family holds about 40 per cent stake in the airline, the three Dube brothers—Vinay Dube, Sanjay Dube, and Niraj Dube—hold about 30 per cent stake in the carrier, they added.
Vinay Dube, who is also the chief executive officer (CEO) of the airline, said: “We are thankful to our marquee investors for placing their confidence in Akasa Air and its leadership, and to the Jhunjhunwala family for their unwavering faith in the Akasian dream."
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In a market where two airlines—Air India Group and IndiGo—hold more than 85 per cent domestic passenger market share, Akasa Air is currently a small airline. Its domestic passenger market share in 2024 stood at 4.6 per cent, as per Directorate General of Civil Aviation (DGCA) data.
Akasa Air's chief financial officer (CFO), Ankur Goel, stated that the airline prioritises long-term planning over anything "short-term". He described the strategic investments as an important step in ensuring financial stability and supporting the company’s goal of building a sustainable, forward-looking business. He added that Akasa Air remains well capitalised, and these investments would help secure steady growth while providing a financial cushion against unforeseen challenges.
The airline said the funds raised will help it become "one of the top 30 airlines in the world" by 2030. The airline will continue to invest in "safety, reliability, and cutting-edge technology".
The funds raised will also be used to drive "international expansion" and enable the airline to foster a "high-quality work environment" for employees, it added.