Shares of India's ailing Kingfisher Airlines nosedive nearly five per cent amid mounting fears for the carrier's survival.
India's Kingfisher Airlines grounded for third day
MUMBAI // Shares of India's ailing Kingfisher Airlines slid nearly five per cent today as all of its flights remained cancelled for a third straight day amid mounting fears for the carrier's survival.
The carrier, which has a debt of nearly US$1.3 billion (Dh4.7bn) and is desperately scouting for a foreign airline to pump in fresh capital, declared a partial lockout on Monday night, blaming unrest by striking workers.
The Bangalore-headquartered airline said a minority group of "recalcitrant employees" had forced a "complete paralysis" of operations, leading to the cancellation of all flight operations for three days.
Kingfisher's engineers went on strike last Friday to protest against not being paid since March, with some pilots and other employees joining the walkout on Monday, according to media reports.
The airline's chief executive Sanjay Agarwal was summoned to meet the aviation regulator chief on Tuesday in New Delhi.
"We are hopeful that we will resolve the situation in the next few days. We will take a call on October 4 on resumption of our operations," Mr Agarwal told the Press Trust of India news agency after the meeting.
He also promised that the backlog of salaries not paid since March would be given to employees "soon".
Kingfisher shares slumped 4.89 per cent to 14.6 rupees after India's civil aviation regulator said the company cannot fly again until it submits a revival plan and meets all safety norms.
The stock has now fallen 9.42 per cent this week.
The airline, which owes millions of dollars in taxes as well as money to suppliers, lenders and staff, has been forced to drastically cut down its operations in the past year, shutting down international flights completely.
The company was India's second-largest airline until a year ago but now has a market share of just 3.2 per cent, the smallest of the country's carriers.