Jet Airways' Naresh Goyal knocks on Mukesh Ambani's door

The Naresh Goyal-owned Jet Airways is hunting for a new investor. The cash-strapped airline which is struggling to raise working capital has reportedly knocked on the door of India's richest man, Mukesh Ambani.

According to a report in Livemint, Naresh Goyal has approached Mukesh Ambani in his personal capacity but Reliance Industries' chairman is yet to take a call on Goyal's offer.

This comes close on the heels of reports saying that salt-to-software conglomerate Tata Group may be buying a large stake in the loss-making Jet Airways. Tata Group's chairman emeritus Ratan Tata has been bullish on aviation sector for a long term, and the buying of stake in Jet would place the group in the top league within the sector.

Goyal, the founder chairman of Jet Airways who holds controlling stake of 51 per cent, is also said to be in talks with international airlines for potential fundraising. In 2013, Jet Airways sold 24 per cent equity to Etihad Airways for $379 million after the government allowed foreign airlines to take up to 49 per cent stake in Indian carriers.

The report added that Tata Group was interested in buying a stake in Jet Airways but this was contingent on Goyal relinquishing operational control.

The stake purchase is expected to make Tata Group the second biggest airline operator in the country after IndiGo in terms of market share, and third-largest in terms of fleet size.

The Tata Group already owns substantial stake in two carriers - 51 per cent in Vistara and 49 per cent in AirAsia India. With Jet under its fold, the Tata Group-owned airlines would have a combined market share of 23.6 per cent as compared to 41.9 per cent for IndiGo, as per August data. The fleet size of Tata Group-owned airlines would be 159, which is lesser than Air India Group's 176 (including Air India Express and Alliance Air) and IndiGo's 172 aircraft.

Surprisingly, the Tata Group-owned airlines would have far higher staff strength (18,774) as compared to IndiGo's 14,604 and Air India Group's 13,518, as mentioned in the DGCA's Handbook on Civil Aviation Statistics 2017/18. In fact, the combined personnel strength of the Tata Group-owned airlines would be over 32 per cent of the staff count of the sector. The higher staff strength also points out to the higher staff-per-aircraft ratio of 118 as compared to its peers - IndiGo's 84.9 and Air India Group's 76.8.

As part of its survival plan, Jet was reportedly trying to raise capital by monetising its stake in the frequent-flyer programme - JetPrivelege - in addition to conducting sale and-lease-back of 16 wide-body aircraft - Boeing 777 and Airbus A330 - that the airline owns. Earlier in October, it received about Rs 258 crore from JetPrivilege for advance ticket sale.

Jet had a gross debt of Rs 8,620 crore as on June this year, and net losses of Rs 724.94 crore in 2017/18. The airline has a negative net worth of over Rs 7,000 crore.