Deccan Aviation IPO in May

BY A CORRESPONDENT
April 18, 2006

Low-cost airline Air Deccan may tap the capital markets in Mid-may. Deccan Aviation, the parent company of Air Deccan, has filed an updated draft red herring prospectus with India's capital markets regulator Sebi. The company had to make some changes in its prospectus after they were sought by Sebi.

Deccan Aviation had initially planned to open its IPO in April. This did not happen. It has been speculated that the delay in issue price and the aggressive issue pricing had made JP Morgan and Amro Bank withdraw from the book-running lead manager positions.

Other airline stocks listed in India are from Jet Airways and Royal Airways (which owns SpiceJet). Jet Airways stock had taken a severe knock following its acquisition of Air Sahara and has now stabilised around Rs 1100.

It is expected that the Deccan Aviation IPO will be priced around Rs 250. The company may mop up around Rs 2000 crore from the IPO. Jet's market capitalisation is around Rs 8380 crore.