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Jhunjhunwala's Last Bet: Akasa Air's Path to Profitability
9 Dec
Summary
- Akasa Air is not projected to achieve Ebitda positivity soon.
- Rakesh Jhunjhunwala saw low-cost airlines as the correct model for India.
- Significant work remains for Akasa Air to reach a strong valuation.
Akasa Air, a significant investment for the late Rakesh Jhunjhunwala, is currently facing a prolonged period before achieving positive Ebitda. This suggests that, for the airline's planned listing in the coming years, there is considerable effort needed to establish a robust valuation.
Jhunjhunwala had previously expressed strong conviction in the low-cost airline model's suitability for the Indian market. He reportedly shared this view during IndiGo's initial public offering roadshows, recognizing the potential of budget air travel.
However, achieving a valuation similar to that of IndiGo will require Akasa Air to overcome substantial operational and financial hurdles. The airline must continue to develop its strategy to ensure long-term sustainability and market competitiveness.
