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Last Updated: Friday, 7 January 2005, 15:42 GMT
India's Jet Air plans share sale
Airplane on tarmac
Rising incomes are set to boost demand for flights in India
India's biggest airline Jet Airways is planning to sell 15bn rupees ($343m) of shares to raise cash for new planes, cut its debt and build new facilities.

It will offer about 17 million shares, or about 20% of its total equity.

Jet accounts for 43% of India's air travel market, but faces competition from rivals and low-cost carriers.

Investors are keen to tap into India's booming economy because the fast growth is driving consumer and corporate demand for services like air travel.

Expansion plans

"The IPO is expected to do well in the current market conditions," said KK Mittal of Escorts Mutual Fund.

The sale share price will be determined at a later date, but may be as high as 870 rupees.

Jet will offer 60% of the shares on sale to institutional investors, 25% will go to small investors, with the final 15% being sold to non-institutional buyers.

The new planes will help the company expand the number of destinations it offers.

India recently agreed to allow domestic commercial airlines to fly long haul routes, with Jet and Air Sahara the two companies to benefit initially.

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