Error creating thumbnail: convert: unable to open image `/home/wikinvest/src_live_2/mediawiki/images/9/91/Kingfisher_Airlines_logo.png': No such file or directory @ blob.c/OpenBlob/2480. convert: unable to open file `/home/wikinvest/src_live_2/mediawiki/images/9/91/Kingfisher_Airlines_logo.png' @ png.c/ReadPNGImage/2889. convert: missing an image filename `/home/wikinvest/src_live_2/mediawiki/images/thumb/9/91/Kingfisher_Airlines_logo.png/100px-Kingfisher_Airlines_logo.png' @ convert.c/ConvertImageCommand/2800.Kingfisher is an Indian airline operating both domestic and international flights. Kingfisher Airlines provides flights to more destinations than any other domestic carrier.  Kingfisher operated with an average load factor of 67.9% during the first half of 2009. The load factor for an airline measures the percentage of available seats that are filled during a specific period. The average load factor for Kingfisher's three closest competitors by market share was 69.43%. Over the same period Kingfisher operated with an Available Seat Miles(ASM) of 6.6 million. The ASM of an airline is equal to the number of available seats times the number of miles flown. The average ASM of the same three competitors by market share was 5.22 million for the same period.
For year ended March 2009 Kingfisher had revenues of 10.9 billion dollars for average revenues of 2.72 billion dollars a quarter (as of Sept. 25, 2009 exchange rate 1 dollar = 48.1 rupees).  However, Kingfisher had a loss of 3.34 billion dollars for year ended March 2009 and a loss of 504.5 million dollars for the second quarter of 2009. This loss was mainly due to a sharp decrease in demand for flights and losses due to the start-up of international operations.
The rising cost of fuel has posed many problems for the global air travel industry. Kingfisher reacted to these problems by returning or deferring the delivery of new aircraft as well as by changing some of its routes. Kingfisher added 3 new international destinations to its flight network in September 2009 as part of these route changes. Another issue facing Kingfisher is the unusually high tax imposed on Aviation Turbine Fuel (ATF) by certain states in India. Legislation is being supported by the Minister of Finance and the Indian airline industry to lower the tax on ATF.
Founded in May 2005, Kingfisher's route network has grown to include 69 cities in India and 7 international cities. Kingfisher added 3 international destinations to its network in 2009. Kingfisher is recognized as a '5-star airline' for its excellent product and service quality by Skytrax, an independent travel forum and air travel information organization. Kingfisher has a fleet of 74 aircraft ranging from ATR 72-500 (70 passengers) to Airbus A330 (300 passengers) and operates 400 flights a day in India. 
Kingfisher Airlines is the largest Indian airline by number of passengers carried over domestic routes. Over the first 6 months of 2009 Kingfisher carried 5.44 million domestic passengers, which amounted to 22% of all domestic travelers in India, and 144,561 international passengers. 
For year ended March 2009 Kingfisher had revenues of 10.9 billion dollars compared to revenues of 3 billion dollars for 9 months ended March 2008.  Kingfisher maintained an average revenue of revenues of 2.7 billion dollars for the 2nd quarter of 2009. However, Kingfisher had a loss of 3.35 billion dollars for year ended March 2009 and a loss of 510 million dollars for the second quarter of 2009.
The increase in revenues from March 2008 to March 2009 is due to a 12% increase in revenue per Revenue per Available Seat Mile. Despite these increasing revenues Kingfisher had losses due to start-up costs of international operations, new routes, training requirement and the high cost of aviation fuel in India and lower load factors.</ref name=clause41>
Over the second quarter of 2009 Kingfisher operated 23% less flights due to less demand leading to a 6% drop in revenue compared to the previous quarter. Furthermore, an upswing in personnel costs was caused by the increase in number of employees and their salaries.. Despite its financial losses, Kingfisher still managed to carry the most passengers in the domestic industry by carrying 25.3% of passengers flown in the country.
Kingfisher operated with an average load factor of 67.9% during the first half of 2009. The load factor for an airline measures the percentage of available seats that are filled during a specific period. Over the same period Kingfisher operated with an Available Seat Miles(ASM) of 6.6 million. The ASM of an airline is equal to the number of available seats times the number of miles flown.
|9 months ended March 2008||Year ended June 2007||15 Months ended June 2006|
|Gross Profit Margin||-15%||3.22%||0.296%|
Although the Indian economy managed to stay level during 2007-2008 the rise in crude oil prices resulted in a 60% rise in the average price of aviation turbine fuel (ATF) from April to September 2008. Along with higher ATF prices, high duties and taxes on ATF in India resulted in higher fares and lower demand for air travel. The increase in fares coupled with the lean season (June to September) caused a drop in demand and load factor of 6%, bringing Kingfisher's load factor in line with the industry.
Although demand was decreasing, Kingfisher's capacity over many routes was increasing, leading to fares below break-even on certain routes. These resulted in high losses for the Indian air travel industry and Kingfisher as seen by the increasing operating expenses and operating loss.
In December 2007, Kingfisher completed its merger with Air Deccan to increase its service offerings. After the merger, Kingfisher began to offer "Kingfisher Red" flights (low fare economy class) in addition to its business and premium economy class services.
Helicopter Charter (2.26% of Sales) - Kingfisher also offers helicopter charter services to certain destinations in India. Kingfisher made 349 million Rupees in revenues from these charters between July 2007-March 2008.
Cargo Services (0.22% of Sales) - Cargo services also contribute to Kingfisher's yearly revenues. From July 2007-March 2008, Kingfisher made 3.17 million Rupees by transporting cargo.
Fuel prices progressively increased by a total of 28% between June 2007 and March 2008. This led to a 22% increase in direct operating expenses per quarter during the same period. Increasing expenses caused Kingfisher to charge higher prices on certain routes in its network, return 11 aircraft, and defer delivery on future aircraft.
The Ministry of Civil Aviation is in discussions with the government to lower the sales tax imposed by certain states on ATF. In August 2009, except for a few states that charge 4% tax on ATF, the sales tax on ATF in India was 25-35%. With ATF making up a large amount of an airline's operating costs, legislation to uniformly lower the sales tax in India will let Kingfisher operate with higher profit margins.
Although it is primarily a domestic carrier, Kingfisher slowly increased its international offerings in 2009 by providing flights between Mumbai and Singapore as well as between Mumbai and Hong Kong. The vice president of the company has announced that the success of these new routes will determine whether Kingfisher will go ahead as planned and offer more international flights out of Mumbai. Kingfisher's research shows that these flights fit in with their policy to redeploy capacity to routes with higher yields. However, the start-up costs of these new routes were very high and led to an operating loss in 2009.
After its merger with low-fare airline Air Deccan in 2007, Kingfisher has been able to offer low fare domestic flights as part of its Kingfisher Red class of service. This lower fare class has let Kingfisher offer low cost domestic flights in a period when demand for premium class tickets has decreased. As a result, Kingfisher is able to compete with low-cost carriers that were able to offer lower prices on its routes. Kingfisher now offers a single class low fare flight on 70% of its route network. Furthermore, by merging with Air Deccan Kingfisher has increased the size of its network and fleet.
As Kingfisher is primarily a domestic flight provider, its main competitors are other Indian airlines. Along with Kingfisher, Air India-Air India Express-Indian Airlines, Jet Airways-Jet Lite, and IndiGo control nearly 80% of the domestic market.
Air India and Indian Airlines are two state owned airlines that work together on many flights. The table below lists the main performance parameters of these four companies for the first half of 2009. 
|Airline||Passengers Carried (million)||Revenue Passenger Kms (million)||Available Seat Kms (million)||Load Factor (%)|
|Air India-India Express-Indian Airlines||2.81||2.94||4.64||63.4%|
|Jet Airways-Jet Lite||5.04||4.78||7.07||67.6%|
In July 2009, these 4 airlines carried 79.5% of all domestic passengers in India. The remaining 21.5% of passengers were carried by other private Indian airlines such as Spicejet, Go Air, and Paramount.