Akasa Air's IPO journey: Will it soar like IndiGo?
What's the story
Akasa Air, India's newest airline, is gearing up for an initial public offering (IPO). However, the company is not expected to turn EBITDA-positive in the near term. This raises questions about its ability to achieve a strong valuation similar to IndiGo's. The airline industry veteran Rakesh Jhunjhunwala had endorsed the low-cost model nearly a decade ago when IndiGo was preparing for its own IPO.
Investor insight
Jhunjhunwala's endorsement of IndiGo's low-cost model
During roadshows for IndiGo's IPO, Jhunjhunwala was all praises for the airline's low-cost model. He told some of the airline's officials that "low-cost [airline] is the right model for India." The endorsement came after Jhunjhunwala had done his own background checks on IndiGo and was convinced about its potential in India's aviation market.
Growth trajectory
Akasa Air's path to profitability
Akasa Air, backed by Jhunjhunwala, has a long way to go before it can match the strong valuation of IndiGo. The airline is still working on its business model and expansion strategy to achieve profitability. Despite the challenges, Akasa Air remains optimistic about its growth prospects in India's competitive aviation sector.