Air India seeks US$1.5 billion equity infusion from Tata and Singapore Airlines

Air India is seeking approximately US$1.5 billion in fresh equity from its owners, Tata Sons and Singapore Airlines, to support its ongoing multi-billion-dollar transformation and fleet refurbishment program.

The request follows a period of significant financial difficulty, with the carrier and its budget subsidiary, Air India Express, reporting combined losses of US$2.33 billion for the fiscal year ending in March. This figure represents more than double the losses recorded in the previous year. The financial strain has also impacted the profits of Singapore Airlines, which holds a roughly 25% stake in the Indian carrier.

Operational challenges contributing to the deficit include regional airspace restrictions, disruptions caused by geopolitical conflicts in the Middle East, and the aftermath of a fatal aircraft crash last year. Tata Sons Chair N. Chandrasekaran has indicated that the airline's full turnaround could take up to a decade due to the need for systemic cultural shifts, legacy system overhauls, and supply-chain disruptions. If approved, the capital infusion is expected to be provided in structured tranches.