Image Credit: Business Standard


Rakesh Jhunjhunwala, India's ace investor, has stated his intention to enter the country's troubled aviation sector.

The resulting constraints around the Covid-19 epidemic have already had a strain on the aviation industry.

On the Frontier: A New Air Carrier:

Jhunjhunwala said on Saturday that he would be speaking at a virtual panel discussion hosted by investment firm Equirus to promote a new airline.

He did not, however, provide any other information. He said, “I love when people say you want to be a millionaire and that’s why you are investing in an airline,”.

Jhunjhunwala, widely described as a "big bull," is the founder of Rare Enterprises, private equity, and asset management firm.

He said, “I like that kind of attitude when I do something,”.

A Plan To Invest In A New Airline:

Jhunjhunwala's net worth is estimated to be more than $4 billion.

He owns around 5% of the jewellery company Titan Company Limited, which is worth $1 billion in its own right.

During the conversation, Jhunjhunwala said, “By the way, one-third of my wealth is in unlisted equities. I also invested in 14 to 15 companies and am now promoting a new airline,”.

Jhunjhunwala was previously reported to be “exploring a plan to support a new, low-fare airline venture” in mid-July, according to sources.

He had reportedly undertaken “preliminary talks for a $35 million investment” in the airline.

He has previously bet on the stocks of IndiGo, Jet Airways, and SpiceJet, all of which are listed domestic airlines.

In May 2017, he famously questioned the top brass of InterGlobe Aviation, the company that owns IndiGo, about their poor performance.

Analysts Say Now Isn't the Right Time

According to the rating agency ICRA, Indian airlines suffered net losses of Rs 21,000 crores in FY21 due to the current epidemic.

In addition, ICRA forecasts a net loss of Rs 12,700 crores for domestic carriers in FY22, with the industry's debt level rising to almost Rs 50,000 crores.

According to Jitender Bhargava, a former Air India executive director, “the environment is simply not conducive for any new carrier to get into the Indian market,”.

Vinamra Longani, the head of operations at Sarin & Co., an Indian legal firm dealing in aircraft leasing and finance, tweeted, “unless you have passion, determination, risk appetite, deep pockets and patience like the Tata Group, do not invest in an airline in India,”.

Additionally, “If  you do, the unending competition, cheap fares and high costs will in all likelihood drive you to an unfortunate end.”

Jhunjhunwala, on the other hand, seemed unconcerned with the reality on the ground, saying “I like to look at things in a very broad way,”.

He exclaimed proudly, “People call me by various names—sometimes big bull-like Harshad Mehta, then Warren Buffet. I don’t know what I am, but I am what I am.”

(Source: Trak)