Spice Jet

Istithmar, the Dubai government's investment arm, which already owns about 13.5 per cent in low-cost airline based Spicejet, is looking to hike its stake in Spicejet.

Spicejet's third quarter results may be down more than 22 per cent than last year's third quarter but international investors like Istithmar say that they want to stay invested in the Airline.

Istithmar is even keen to hike its holding in the airline, which stands at about 13.42 per cent. Istithmar also has bonds, which it can convert to shares anytime by 2010.

'If any of the promoters want to sell their stake, we will buy them out,” said Tom Ronell, CEO, Istithmar World.

Istithmar's moves of increasing their stake will certainly trigger an open offer making them the largest shareholders in the company.

However, despite Istithmar's renewed confidence in the airline Spicejet is having a tough time breaking even and the high ATF prices mean that even though Spicejet has made an operational profit last quarter, the airline will still be in the red this fiscal.

But there is still hope, consolidation in the aviation sector has led to improved yields with Spicejet earning about Rs 500 rupees more per passenger and its net profit for the quarter stood at Rs 9.3 crore, the company will soon place an order for 10 more aircraft for $620 million.