Kingfisher Airlines shares tumble to 17 % due to more cancelled flights

Airlines carrier, Kingfisher Airways on February 21, 2012 said that some of the holders of its debentures have concerted a portion of their holdings in to shares. The airlines also said that they have cut more flights due to which the company shares tumbled to 17 %.

Kingfisher, owned by the business giant Vijay Mallya, has been facing losses since its inception in the year 2005 due to an ill-planned aggressive expansion. The expansion plans included ordering Airbus A380s, which is the world’s biggest commercial jet and also a merger with budget carrier Air Deccan.

The added problems for the airlines include the global economic crisis and the rising fuel costs that affected the passenger traffic. The company owes millions of dollars to its suppliers, lenders, lessors, airline partners, taxes and even employees.

In the month of November it had to cut a number of flights and also stopped its low fare operations to reduce the costs. Recently, the Indian tax authorities froze the bank accounts of the company for the second time.