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    Internship Under CA Final Report

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    Chahat
    Kingfisher Airlines was founded in 2003 and ceased operations in 2012 due to major financial troubles and mounting debt. It grew rapidly but lacked a sustainable business model, taking on large amounts of debt to fund international expansion into unprofitable routes. The airline took loans totaling nearly $1 billion from multiple banks but was unable to repay them due to mismanagement and the global recession negatively impacting the aviation industry. This ultimately led to the collapse of Kingfisher Airlines.

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    Internship Under CA Final Report

    Uploaded by

    Chahat
    143 views22 pages
    Kingfisher Airlines was founded in 2003 and ceased operations in 2012 due to major financial troubles and mounting debt. It grew rapidly but lacked a sustainable business model, taking on large amounts of debt to fund international expansion into unprofitable routes. The airline took loans totaling nearly $1 billion from multiple banks but was unable to repay them due to mismanagement and the global recession negatively impacting the aviation industry. This ultimately led to the collapse of Kingfisher Airlines.

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    Kingfisher Airlines was founded in 2003 and ceased operations in 2012 due to major financial troubles and mounting debt. It grew rapidly but lacked a sustainable business model, taking on large amounts of debt to fund international expansion into unprofitable routes. The airline took loans totaling nearly $1 billion from multiple banks but was unable to repay them due to mismanagement and the global recession negatively impacting the aviation industry. This ultimately led to the collapse of Kingfisher Airlines.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    143 views22 pages

    Internship Under CA Final Report

    Uploaded by

    Chahat
    Kingfisher Airlines was founded in 2003 and ceased operations in 2012 due to major financial troubles and mounting debt. It grew rapidly but lacked a sustainable business model, taking on large amounts of debt to fund international expansion into unprofitable routes. The airline took loans totaling nearly $1 billion from multiple banks but was unable to repay them due to mismanagement and the global recession negatively impacting the aviation industry. This ultimately led to the collapse of Kingfisher Airlines.

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    Presentation on the topic

    “KINGFISHER AIRLINES SCAMS”

    R
    In partial fulfilment for the award of the degree of
    Masters of Business Administration(MBA)

    TARANPREET KAUR
    TANEESHA RASTOGI
    ABOUT KINGFISHER..
    Introduction of Kingfisher...
    OWNER - DR.VIJAY MALLYA

    Business Operation: Airlines


    Founded :2003
    Commenced operations :9 May 2005
    Ceased operations: Oct 2012 (flights suspended)
    Feb 2013 (licence revoked)
    Hubs: Bangaluru International Airport
    Secondary hubs :
    •Chhatrapati Shiva ji International Airport
    •Indira Gandhi International Airport
    •Chennai International Airport
    •Pune International Airport
    Company slogan : Fly The Good Times
    Headquarters: Mumbai
    ]
    Key people :Sanjay Aggarwal (CEO)
    Vijay Mallya (CMD)
    Employees : 5,696 (2012)
    Background:

     Kingfisher Airlines is one of the leading private players in the Indian aviation industry.

     In India, the airline has a network in 72 cities operating more than 400 flights a day
    and commands a market share of 25%.

    This airline offers three unique classes of services Kingfisher First


    (Business class), Kingfisher Class (Premium economy) and Kingfisher Red (Low fare).

    Internationally, it operates flights to Dubai, Colombo and London.(after the


    acquisition of AIR DACCAN)

     Kingfisher Airlines is only five star airline in the Indian skies and is known for
    providing world class in fight services to its passengers.

    The company has emerged as the first Indian airline that provides a range of services
    in the mobile segment such as flight updates , ticket buying through SMS and many
    more.
    AWARDS & ACHIEVEMENTS ..

    • Kingfisher Airlines was awarded NDTV Profit


    Business Leadership Award for Aviation.
    • Kingfisher Airlines was acknowledged as
    ‘India’s only 5 Star airline’ and ‘6th airline in
    the world’ was certified by Skytrax.
    • Kingfisher was rated as Asia Pacific’s ‘Top
    Airline Brand’ in a survey conducted by TNS on
    ‘Asia Pacific’s Top 1,000 Brands’ for 2008
    • Economic Times Avaya Award 2006 for Excellence in Customer Responsiveness

    •India's No. 1 Airline in customer satisfaction by Business World

    •The Best Airline and India's Favourite Carrier in a Survey conducted by IMB for The
    Times of India.

    •Best New Domestic Airline for Excellent Services and Cuisine by Pacific Area Travel
    Writers Association (PATWA)..

    •Ranked Third in the survey on India's Most Successful Brand launch of 2005 under the
    Brand Survey conducted by Business Standard

    •Best New Airline of the Year Award for 2005 by Centre for Asia Pacific Aviation (CAPA)

    •Award in the Asia-Pacific and Middle East region.


    About the owner..
    • DR.Vijay mallya
    “KING OF GOOD TIMES”
    “THE PLAY BOY OF EAST”
    CHAIRMAN : United Breweries
    • Worldwide he were counted under top 100
    richest persons
    • India’s richest person ranked at 40th 2007
    • Top model photo shoot for calendar( limited
    edition)
    • Joined politics 2000,now he is the member of
    Rajya Sabha
    • Southern California university gave doctorate
    degree in business administration.
    • "Officier de la Légion d'Honneur", a high
    award of recognition in France.
    • "Global leader for tomorrow", World
    Economic Forum
    • "Entrepreneur of the Year" award at The Asian
    Awards(2010).
    • Owner : RCB
    • Co-owner : Sahara force F1 race
    Kingfisher airline is the set of:
    • Experience ,
    • luxury &
    • Lifestyle
    •

    •
    Reasons behind its failure!
    1. Mismanagement into a scam..
    Non –profitable route

    No sustainable business model

    Bail out loans from banks


    List of bank loans ,which were
    became scam later...
    14 Banks were involved including SBI which allot
    1500cr as a loan to kingfisher airlines
    Total bank loan amount =6360cr
    Others 3 banks =603cr
    Total 17 banks loans=6963cr
    Which were not paid by DR VIJAY MALLYA &
    later it become scam of 1500cr (including
    interest rates)
    KINGFISHER CARRIER

    Low cost model Premium model


    (economy premium mixed)
     business does not runs only with money &
    branding,
     its require effective BOARD LEVEL &
    MANGEMENT LEVEL
    DUE TO BLUR BRANDING BUSINESS MODEL WERE
    NOT CLEAR!!!
    2.MISTAKE OF ACQUISTION &
    EXPANSION
    Loss making & bleeding

    international market

    Low margin high investment

    high competition
    Due to blur branding ..

    vs.

    Full service carrier low cost carrier & full service carrier

    CONCLUSION:

    kingfisher(premium international carrier)


    kingfisher red (low cost domestic carrier)
    Expansion without gross margin
    committing suicide!!!
    Lack of
    Liquidity

    Profitability

    Loan repayment

    Reserve &surplus

    Cash surplus
    3. FAST CASH & LOW PROFIT
    • Playing with your cash can be extremely
    dangerous –
    when it based on wrong calculation
    and when there is wrong assumptions
    • Actually you need deep pocket & loss
    absorption capacity .
    4. Global recession
    • “lehman brother scandal “ USA 2008
    • Economic crisis were the major reason of
    being failure and cause-
    lower occupancy crude price

    slow ticket state dollar value increased


    less buying capital
    In airlines industries ,if occupancy is less than
    75% so it means LOSS!!!

    Actually you need deep pocket & loss


    absorption capacity..

    Breweries is a business of fun but airlines is a


    business of caution..
    Corporate practices introduced after
    scam!
    • When kingfisher airlines were facing its
    downfall ,at that time there were an
    American co. ETIAD ,ready to invest on
    kingfisher airlines but ,
    • Government of India does not permitted for
    FDI (FOREIGN DIRECT INVETSMENT)
    • In 2014, GOI allow for FDI ,
    • So in this way ETIAD invested in jet airlines.
    Conclusion...
    • Although it capture 25% of market share , and
    became world 2nd largest airline 2005
    • Won many awards achieved by that airlines
    due to its services it offered.
    • Due to its wrong calculation and assumption
    cause its downfall , if there were proper
    management and business model it would not
    happen .
    Thank you!

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