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The future of Jhunjhunwala-Backed Akasa Air

“Everything happens for a reason. Luck and fate are the same things. It just depends on how you look at life"

This is probably what Akasa Air must be wishing for right now to deal with the loss of Rakesh Jhunjhunwala.


Who has not heard about Rakesh Jhunjhunwala? A billionaire, stock trader, business magnate, and an ace investor. Starting with a mere Rs 5,000 as an investment, he came a long way and invested a little more than Rs 11,000 crores in Titan Company Ltd – his highest investment ever. He gave life to many startups by investing in them and showing faith in their ideas. One such company is what we have been hearing a lot about in the past few months – Akasa Air. Akasa Air was founded in 2021 with the motive of providing affordable flight fares to all classes of people.

Whether call it destiny or just a stroke of bad luck, Rakesh Jhunjhunwala died exactly 7 days after Akasa air’s first flight. He held nearly 40 per cent of the stake in the company and was among the founding members. Akasa Air is an airline brand under the holding venture SNV Aviation, owned by Jhunjhunwala.

"... nowhere in the world is an airline conceived and born in 12 months. Normally, a child is born in 9 months, we took 12 months," he had said at the ceremony where the first flight was flagged off virtually by Civil Aviation Minister Jyotiraditya Scindia.

What Did Rakesh Jhunjhunwala Mean For Akasa Air?

Rakesh Jhunjhunwala was more than just an investor in Akasa Air, he was a mentor, a leader, and a guiding force. Had he not been there, Akasa Air would not have reached where it is today, although it is just the start. Not only did he make the very first and crucial step of acquiring finance easier for the company, but he could also help in arranging for easy finance in the future. This finance could be from both – Indian banks and foreign institutional investors.

Finance is the lifeblood of a business organization and it will not be wrong to say that Rakesh Jhunjhunwala was—and will remain— the ‘King of Finance.'


The Other Side of the Coin

While it is right to believe that Akasa Air will be affected in quite many ways because of the demise of Rakesh Jhunjhunwala, there is another opinion on the situation too. Many people believe that because he was just an investor in the company, the day-to-day operations of the airlines will not be affected directly. And as for finance, there are ample sources available in the current business world.


Now What?

Akasa Air started its commercial operations with two aircrafts and plans to induct two 737 MAX aircrafts each month to establish a pan-India presence. Its fleet size will be 18 aircrafts by the end of March 2023 and over the next four years, the airline will add 54 additional aircrafts, taking its total fleet size to 72 aircrafts.

The CEO further says, “Akasa Air will honor Jhunjhunwala’s legacy, values, and belief in us by striving to run a great airline.” But it is easier said than done. Losing someone as expert and intelligent as Rakesh Jhunjhunwala will come at a cost to Akasa Air. But where the airline goes, depends on how well they learn to manage and deal with the loss.


Final Thoughts

All in all, what this ace player of the market could have given to the airlines, would have been tremendous. There is no other person who can compensate for this. For investment purposes, no doubt, many big investors might be willing to invest in Akasa Air, but that would be like a child satiating his want for a remote control car with a simple one.

Not to forget – Rakesh Jhunjhunwala seldom made a failed bet. If he invested in Akasa Air, he must have seen great growth prospects in it.

But who knows what will happen in the future? Anyways, it will be too exciting to see the course Akasa Air takes!





BY:

Harshita Kaushik


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