KFA management will meet lenders' consortium by SBI today

Kingfisher Airlines’ (KFA) management will meet their lenders' consortium led by the State Bank of India (SBI) today to convince them to put additional capital in the troubled airline.

SBI, the lead consortium lender to the carrier however told a news channel that KFA would need to arrange fresh equity of Rs 1,000-2,000 crore before seeking additional funds from banks.

Citing Top civil aviation ministry sources, the Channel said that two of Kingfisher ATR aircraft were seized by the Directorate General of Civil Aviation (DGCA) and handed over to the leasing company after the lessors complained to the airline regulator.

KFA has been in financial mess and the loans given by banks have turned NPA (non-performing asset) for the past couple of months.

The company's net loss widened to Rs 444.26 crore for the quarter ended December 31, due to high fuel costs and weaker rupee, from Rs 253.69 crore in the October-December quarter of last fiscal.

The airlines suffered a loss of Rs 1,027 crore in 2010-11.

Sources: SBI decided loan package to help troubled Kingfisher Airlines

Hours before the beleaguered airline was expected to file a new flight schedule before the aviation regulator, the Directorate General of Civil Aviation (DGCA) and Civil Aviation Minister Ajit Singh met in the national capital on today over Kingfisher crisis.

KFA was yesterday given a 24-hour deadline to come up with a "realistic" flight schedule by the DGCA which ruled out any immediate punitive action to avert further difficulties to air travellers even as the carrier scrapped 40 more flights.

"The airlines will have to file a new schedule instead of a truncated one in the next 24 hours," DGCA chief E K Bharat Bhushan told reporters after the regulator quizzed Kingfisher CEO Sanjay Aggarwal and top officials on how they plan to get the crisis-ridden airline back on track.

Amid reports that SBI has decided on a Rs 1,650 crore loan package to help troubled Kingfisher Airlines, Ajit Singh said that the government cannot bailout private airlines like the beleaguered Kingfisher.

The Aviation Minister also said that passengers’ safety issue should not be compromised at any cost.

He added that it was wrong on the part of Kingfisher Airlines to not have informed DGCA about abrupt flight cancellations in the past few days.

The cash-strapped carrier, facing the wrath of Income Tax authorities which have frozen its bank accounts, was operating only 28 of its 64 planes, leading to large-scale disruption of its schedule for the fifth consecutive day.

Sensex logs 7th consecutive weekly rise

The BSE benchmark Sensex rose 0.8 percent on Friday to record their seventh straight weekly rise, their best run in nearly two years, bolstered by strong foreign fund inflows amid growing concerns the market has run up too fast in a short span of time.

The benchmark BSE index is up 18 percent this year, mainly on buying by overseas portfolio investors who have pumped in USD 4.4 billion so far this year, after pulling out more than USD 500 million in 2011.

Top lenders such as State Bank of India and ICICI Bank were among the top gainers in the day's trading, fuelled by an improved credit demand outlook amid expectations of interest rate cuts by the central bank.

Power equipment maker Bharat Heavy Electricals Ltd closed 6.7 percent higher at Rs 303.55, after rising as much as 14.3 percent to its highest level in three months, as investors bet on a rise in orders this year.

State-run NTPC Ltd plans to award USD 3.25 billion of equipment orders by March-end after a ruling by India's top court settled a case with a bidder in favour of the country's top power producer, its chairman said on Thursday.

The 30-share BSE index closed up 0.75 percent, or 135.36 points, at 18,289.35, its best close in more than six months. Nineteen of its components ended in the positive territory.

"The global liquidity conditions have improved in the last couple of months and India is benefitting from fewer investment opportunities in the developed markets," said Claugio Bernasconi, a Switzerland-based fund manager for AMC Expert India Fund.

"Although a bounceback was expected after the Indian markets became the worst performer last year, I am turning cautious now because this sudden and strong rally is not supported by any improvement in the fundamentals of the country."

Technical indicators show the benchmark index could be ripe for a correction as it is deep in "overbought" territory, with its 14-day relative strength index at 77 on Friday. A score of 70 and above is considered overbought.

Citigroup said in a research report the Indian market rally was mainly driven by overseas inflows with "relatively little evidence" of retail participation, though the domestic economy or the corporate sector outlook have not changed much.

Indian economic growth has lost momentum as lingering eurozone debt woes, coupled with high domestic interest rates and a policy paralysis at home have hit capital investments by companies.

Sensex under pressure; oil & gas, private banks, infra fall

The market remained under selling pressure ahead of expiry in the last month of 2011. It seems that the Nifty may close below the 4700-mark today, weighed down by infrastructure, oil & gas and private banks stocks. The Sensex was down 65 points at 15,662.72 and the Nifty fell 25 points to 4,681.05.

Index heavyweights Reliance Industries and L&T fell 1.65% and 1.34%, respectively.

Among others, Infosys, ICICI Bank, HDFC Bank, HDFC, ONGC, TCS, HUL, ITC and NTPC were down 0.3-0.8%. In the realty space, DLF dropped over 1.5%.

Shares of Tata Power and Maruti Suzuki were biggest losers, falling 2-2.5%. Reliance Communications and BPCL plunged 3% each.

However, shares of SBI and Tata Motors gained 0.6% each. Sterlite Industries topped the buying list, rising 1%.

The market breadth is still in favour of declines; about 1133 shares advanced while 1426 shares declined on the BSE.

Most active shares on exchanges were SBI, Reliance, Fortis Healthcare, Tata Steel, JSW Steel, Jindal Steel, ICICI Bank and Axis Bank.

At 12:48 hours IST : Nifty in narrow range; RIL, Infosys, L&T down

The Nifty showed smart recovery from day's low amid choppy trade, though it could not able to touch the 4700 mark. Overall, it was moving in a tight range of 4680-4699. It was weighed down by index heavyweights Reliance Industries, Infosys and L&T while SBI, ICICI Bank and BHEL were providing good support. The Sensex was down 31 points at 15,696.66 and the Nifty dropped 14.5 points to 4,691.35.

Shares of Reliance Industries dropped for the third consecutive session today, falling over 1%. L&T, Infosys and TCS were down 0.4-0.85%.

Tata Power remained biggest loser among Sensex 30 stocks, declining 2% on profit booking. Maruti, Bajaj Auto and DLF slipped 0.5-1%.

However, major largecaps like SBI, ITC, ICICI Bank, Bharti Airtel, BHEL, Tata Motors and Wipro gained 0.2-0.7%, which limited the downside.

In the second line shares, Jaypee Infra shot up 13%. Mcleod Russel, Fortis Healthcare, Deccan Chronicle and Kwality Dairy jumped 5-6% while Gujarat Flourochemical, Glodyne Tech, Shree Global, Jain Irrigation and TV18 Broadcast fell 5%.

In the smallcap space, Global Offshore, Sandesh, Indo Rama Synthetic, DQ Entertainment and KGN Industries rallied 5-10%. However, PG Electroplast crashed 17%. Fulford, Unichem Labs, GSS Infotech and Alchemist were down 5-6%.