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It could just be a three-way race to grab a stake in India's No. 2 low-cost airline - Spice Jet - which holds an 8% share in the Indian market. Kingfisher, Jet & Paramount Airways (a South India centric business-class airline run by the promoters of Paramount Textiles) may all soon be fighting it out for a controlling stake in Spice Jet.
Also, it has been now a few days that rumours are going around that the Wadia Group promoted Go Air may sell a stake to Paramount. Media reports suggest that Go Air's MD Jeh Wadia is not ready to exit the aviation business just as yet, but is open to selling a 26% stake.

The Panacea for Indian Aviation Industry

This consolidation spree could well be the panacea for Indian aviation industry where almost all the airlines were bleeding badly, thanks to fierce price wars just to grab market shares. This dog-fight had indeed made them too short-sighted and led them to taking huge losses. Even full service airlines like Jet had turned into a loss-making one. All this can be attributed to the viral concept of free-ticketing that hit the Indian aviation sector, courtesy the low cost carriers.

Free Tickets: A Route to Bankruptcy

Free Tickets is a concept which is now seen pretty frequently in the Indian aviation sector. Ever since Air Deccan was launched in 2003, tickets at low prices seem to have been in fashion!

All the other low-cost airlines have followed suite. Lakhs of free tickets are on offer. The passenger just needs to pay taxes on it (which come to somewhere around INR 1200) and the passenger gets a ticket to fly a few months from now. In the recent past, Air Deccan has offered as many as 11 lakh free tickets.

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* Contributed by: -
Shekhar Arya,
MBA 1st Year,
Department of Management Studies,
Indian Institute of Technology, Roorkee.