Kingfisher Airlines NPA~Exposes Political & PSU Banks Nexus to Lend against Brand!

Kingfisher Airlines NPA~Exposes Political & PSU Banks Nexus to Lend against Brand

It was clear to me right in 2009 itself of the danger of lending against the Kingfisher Airlines Brand 

This was my Warning on July 23,2009 

Borrowing against Brands !…Interesting,but Risky area opening out !

Thursday, July 23rd, 2009

Multiple Posts on my views on the KFA Debacle &  Vijay Mallya have been categorised above under Kingfisher Airlines ~Machiavellian Mallyas

KFA was my case study at several Seminars & Workshops where I warned  that it was on it’s way to becoming like Global Trust Bank that vapourised and the over 2 lakh shareholders should exit immediately and potential aggressive investors should not get seduced to buy into it !

Who will now bell the Cat and reveal why the PSU Banks actually lend to KFA,especially under the intangible Brand which Grant Thornton had valued at ,I believe US $ 750 m! ….. the Banks were unable to monetise this to recover their dues !….no surprise here at all !….makes to recall how E & Y had valued in just One Day(Company Law Board had pulled them up for this) the Properties at a value in the Satyam-Maytas Deal to fill the hole in Satyam Balance Sheet ! ….in fact the Banks even converted Part Loan to Equity at Rs 64 !  

Clearly Vijay Mallya’s Proximity to Political Leaders had a hand when the Loans were given & even till date this Proximity is the reason for his continuing arrogance and brazenness ! …. his Rajya Sabha MP Candidature from Karnataka as an Independent was supported by a few Political Parties just to defeat the Nominee of another !

I can only surmise that the Glitterrati,especially those who celebrated with him his 60th Birthday in Granduer, & continue to fawn over him and defend him and his son ad nauseum in columns and  on debate panels on TV News Shows have been and/or continue to be beneficiaries of his largesse with public funds,if i daresay ! ~ Nothing is Free !

Shame !!! ~on these 17 Banks & the many years it has taken them to declare KFA & Mallya as a wilful defaulter  & seek his arrest….investigate who in the Banks was responsible to lend in the first place !…the truth will be revealed then as to why they lend & who made them !

Shame !!! ~ on those defending Vijay Mallya…a lawyer on a panel says to follow due process of law….another says he will pay !….if the due process of law was followed  in time then Vijay Mallya would have been history by now !….the irony is that the victims,the KFA Employees ( a captain on a panel voiced this) want him free so he’s able to pay them their dues….for if he goes behind bars so goes their hopes!….a stock market scamster comes to mind who was arrested & convicted as he owed the  banks heavily but has been on bail  on an Apex Court Appeal now pending for years and has been able to repay the Banks despite his accounts being frozen ! ~ tacit!? …think about it !….manipulated & rigged stocks & got into trouble….then manipulated & rigged stocks again to repay !….the World is round indeed ! read more

Kingfisher Airlines @ Rs 11.75 gasping for Breath !

Kingfisher Airlines @ Rs 11.75 gasping for Breath !

Have blogged several times on KFA right from 2008 cautioning Investors on the risks ~ Search Engine will throw up all these posts

Kingfisher Airlines (KFA) bleeds some more~wonder how it’s yet holding above par at Rs 11.75 ! thus being Valued by the Market at just under Rs 1000 crs ! though Debt and Accumulated Loss is at Rs 10000 crs !

Yet the Financial Statements have been prepared as a GOING CONCERN 

 Need a Miracle for KFA to fly again ! ~ Who would like to take over KFA ! ? ~ it has now just a few planes to fly ~ but no permit to fly~ Debt and Loss of Rs 10000 crs !~ Even with FDI being allowed in Aviation ,it would be simpler and easier for a new Entrant to simply start a New Airline than to try to revive KFA

 Am intrigued that yet 230000 + Shareholders have the conviction to hold KFA Shares ~ there is yet an opportunity to exit at Rs 11.75 ~ unless of course they insist to hold an aggressive appetite and love Kingfisher ~ the Man ~ His Beer ~ and his Airline ! ~ as long as they are aware of the Risks involved in holding this Conviction ! ~ Remember Global Trust Bank (GTB) Fiasco ~ allowed to trade on BSE and NSE despite it being a lost cause ~ then one fine day trading was stopped and one’s holding was simply obliterated overnight from one’s demat account as the bank ceased to exist ! with RBI intervening and allowing Oriental Bank of Commerce to take over only it’s assets

KFA Shareholders be warned that KFA may just go the GTB way !  

Kingfisher Airlines digging it’s own grave…. Mr Mallya, when you are in a Hole stop digging!

Mallya deserves the nasty tweets that are doing the rounds

  • Naresh Goyal of Jet and Mallya of Kingfisher Airlines should merge… their new Airline would be called GOL-MALL AIRLINES !….. GOyaL combines with MALLya
  • What’s the Difference between Vijay Mallya and Richard Branson ?… Branson’s Airline is Virgin while Mallya’s is F____d !
  • Mallya was to fly to New Delhi to explain to the Prime Minister about KFA woes but his flight got cancelled !

Kingfisher Airlines Bank Accounts have been frozen and All across India KFA Flights have been cancelled leaving passengers furiously stranded

Have been watching the heated arguments on this on  Arnab Goswami’s Times Now Debate on Why should the Government bail out Kingfisher…. and was getting increasingly furious at ad man and man around town, Suhel Seth and head of a leading Travel Agency, Ashwini Kacker aggressive monologues defending Mallya… these filibustering ‘I know it all’ egotists, who think only their View is the Only View, kept arguing, actually yelling aggressively…. Kacker used the term ‘bloody’ more than once when he argued that Mallya had pledged his ‘bloody’assets and even his ‘bloody’ life !…. I seriously doubt he has pledged all he has… Remember my tagline for this Blog… Companies may go sick but Promoters rarely do !… and if I recall correctly, a Fixed Deposit Ad by his United Group Company showed him as  Director with a USA Address… Suhel Seth said that the Bank will have to be patient as thousands of crs are involved and if the Airline closes down, they stand to lose all they have lend… it is different if they have lent just Rs 100… they will chase the borrower for life for this !… he sounded and makes it out as if it was the banks fault that they lend in the first place  to KFA !… you cannot blame Mallya for this ! says Seth

Arnab, get me on Times Now against condescending Suhel Seth on this issue…when he is championing conscience and morality causes I’m on his wavelength but when he defends the indefensible like this,he is just being turgid !

… And Kacker…Even if Mallya has pledged all, So what !… KFA is a private business and like any business that does not make money, he would be wise to exit, even at a loss rather than bleed all stakeholders to death… simply because I hold the view that he does not have the ability to turn around KFA… I have blogged several times on KFA woes and the dangerous precedent of State Bank of India lending heavily on the Brand Name… I have no personal axe to grind … am a King Club Member too…. and would love for KFA to revive… but for this miracle to happen,Mallya needs to stop digging first and even have the humilty to apologise for the state of affairs… instead his stooges, like Suhel Seth and Ashwini Kacker, simply pass the buck to the Aviation Industry Woes that have engulfed most Airlines…. Wanna bet ! even if he gets funding,Mallya will yet run his Airline to Ground yet again !… he needs to leave his ego aside and exit the sector read more

Om Namah Shiva !…Happy Maha ShivRatri to All…’M’ certainly is the flavour of the Month !…Mahashivratri,Mamta Banerjee,MCX IPO,Mercator Lines and the Much Maligned Mallya of Kingfisher Airlines….

Om Namah Shiva !…. Happy Maha Shivratri to all of you… Bam Bam Bhole !… Jai Bholenath !

My Wife’s ‘Tandav’ … evidence above (her Arrangetram in 1981), and recent too… seriously!… has kept us Happily Married … and this is not an oxymoron !… we shall celebrate our silver next year in 2013

“Jai Jai Shiv Shankar, Kaata na lage Tunker !…..” Check out Rajesh Khanna & Mumtaz making this Song Immortal in ‘Aap Ki Kasam’ http://www.youtube.com/watch?v=xApijNIJBt8 while consuming the intoxicating ‘Bhaang’ as is traditionally done on this auspicious day Celebrating the marriage  of Lord Shiva and Goddess Parvati

Oh ! do you know what they call ‘Bhaang’ in English !… Shiva’s Regal !

And ‘M’ is certainly the flavour of the Month…

  • Mahashivratri today…. this blog has already wished all of you above
  • Mamta Banerjee… The West Bengal CM’s Mentality and Mindset is being seriously questioned when she thrashed the character of last week’s Kolkata Rape Victim saying the lady who frequented nightclubs, had concocted the story and today after arrests made of some of the perpetrators, says the Police had mislead her !… Ofcourse Mamta is Insensitive.. but was she trying a cover up because she was approached for it !?
  • MCX IPO in the Primary market opens on Wednesday,February 22,2012… It’s a Full Offer for Sale Issue by existing Shareholders in a Price Band of Rs 860 to Rs 1032 of a FV Rs 10 Equity Share… Valuation is not really Cheap… nearly 5x Book and 18x Earnings… Consolidated Networth is just over Rs 1000 crs and a succesfull IPO will give it a Billion Dollar Market Cap… pays Dividend, but has a negative Cash Flow and has serious loss in every major Exchange it has opened overseas… Dubai, Singapore, Bahrain, Africa… the last two have yet to begin operations… will be listed only on BSE…. I am going through the 534 pages RH Prospectus and will blog seperately on MCX IPO in a day or two after also gaining some insights from the inside
  • Mercator at Rs 31 in the Secondary Market for a FV Rs 1 Share… some serious buying observed… High Net Worth Investors have been calling in to confirm this… 52 Week High of Rs 46 and Low of Rs 16…. It was my huge multibagger when I initiated heavy buying in the early 2000s at Rs 45 when it was a FV Rs 10 share… Clients rode it all the way past Rs 2000 ! inside three years !… then Congress regained Power at the Centre and the BJP linked Mercator lost Power ! …. what’s all this heavy buying about now !…. the company has made net losses in the last four quarters…… checking it out… should blog on it shortly
  • Much Maligned Mallya of Kingfisher Airlines…. he’s literally been grounded… Airline is bleeding and therefore so are all stakeholders… bank accounts are frozen… flights are being cancelled all over India… and he’s at the rough end of some real nasty tweets… quite deserving,I daresay !
  • read more

    Kingfisher Airlines virtually Grounded by Debt and Share Price sinks below Rs 20…Fears come alive of Borrowing on the Brand

    Kingfisher Airlines…Fears come alive of Borrowing on the Brand….The struggling Airline is virtually grounded with Heavy Debt … some taken even against the Brand…..Pilots are leaving enmasse and flights are being cancelled daily…Share Price has sunk below Rs 20

    http://www.hindustantimes.com/News-Feed/SectorsAviation/Kingfisher-seeks-Govt-bailout-40-more-flights-cancelled/Article1-767695.aspx

    Management and Mallya are putting up a Brave face…will have to quickly come up with atleast Rs 500 crs and in the next few months raise over Rs 1000 crs to stay in the Air…With the Intangibles Channel of the Brand now being exhausted to raise funds,the only way for Mallya is to either sell out the Airline or sell or pledge Group Assets to raise funds

    The King of Good Times is now begging the Government to bail his Airlines out in Pauper Times !…Ironic !…hope the Government does not fall for this again !….Of course there is a larger Picture involved to support our Aviation Industry but First the King needs to infuse some more himself by leveraging or selling his Group Assets…IPL…Formula One…Kingfisher and United Group Real Esate Assets…their kingfisher dhun “Oooh la la la la aey oh!” has whittled down to just “Aey Oh!”….and I’ll let you on to something here…the last time the Banks lend to the Airlines,the Agreed Arrangement Fees to an Intermediary related to one of the Lender Banks was not paid in full…in fact was reduced from Rs 20 crs to just Rs 1.5 crs….Now ! Now !…more than meets the eye here too !

    Had warned in July 2009 that while Borrowing on the Brand was interesting,it did throw up some huge risks

    No Airline…No Brand !….How then would a lender against the Brand, State Bank of India recover it’s dues of @ Rs 2000 crs !…What good is the Brand in such a situation !…you can’t sell it to a rival airline ! can you ! ?

    Check out earlier Blogs on this

    Auditors warn of ‘Kingfisher Airlines’ being a ‘going concern’ problem in the making!

    Thursday, September 15th, 2011

    Borrowing against Brands !…Interesting,but Risky area opening out !

    Thursday, July 23rd, 2009

    Some Wednesday Wanderings !…May’s Heat Wave causing a Lot of Bouncing !…Kingfisher Airlines Cheques…Adnan Sami…Tata’s JLR Debt woes forcing sale of TCS Shares…and our Sensex !

    Wednesday, May 6th, 2009

     

    Auditors warn of ‘Kingfisher Airlines’ being a ‘going concern’ problem in the making!

    Todays Economic Times Headlines scream that Auditors warn of ‘Kingfisher Airlines’ being a ‘going concern’ problem in the making!

    http://economictimes.indiatimes.com/news/newsbyindustry/transportation/airlines/aviation/Vijay-Mallya-promoted-Kingfisher-Airliness-auditor-BK-Ramadhyani-Co-raises-doubts-over-companys-survival/articleshow/9987287

     

    http://economictimes.indiatimes.com/markets/stocks/stocks-in-news/kingfisher-airliness-auditor-raises-doubts-over-companys-survival-stock-falls/articleshow/9989691

     

    In mid 2009,I had blogged twice on KF Airlines…once when their Cheques were bouncing and later when they valued their Brand and took loans against this !

    Some Wednesday Wanderings !…May’s Heat Wave causing a Lot of Bouncing !…Kingfisher Airlines Cheques…Adnan Sami…Tata’s JLR Debt woes forcing sale of TCS Shares…and our Sensex !

    Wednesday, May 6th, 2009

    Borrowing against Brands !…Interesting,but Risky area opening out !

    Thursday, July 23rd, 2009

    The Risk is clearly playing out for KF Airlines…It has never stopped bleeding

    What will be the Brand Value of Kingfisher Airlines if there is no Airline left !…How then will SBI recover what it has lend KF Airlines against their Brand Value ! ?