Investment in Vistara by Singapore Airlines

Vistara is a joint venture between Tata Sons and SIA, in which the Singapore-based carrier holds 49 per cent. “The partnership with Vistara has proved mutually beneficial for both parties. It has allowed us to get traffic from areas where we don’t fly to,” said David Lim, General Manager, India, at SIA. Recently, the promoters infused another 2 billion into Vistara, taking the total to 15 billion. Vistara, however, has registered losses in FY16 and FY17 due to which the airline’s net worth is negative by 10 billion. Lim highlighted the importance of the growing Indian market for SIA, with the number of outbound tourists increasing. Singapore gets one of the highest numbers of tourists from India, which is behind China and Indonesia. The India-Singapore outbound market grew by 16 per cent in 2017, compared with 2016. SIA, however, has not been able to take much advantage of the growth due to constraints of bilateral flying rights. Due to the constraint, SIA together with sister concern, SilkAir, is able to increase only 10 flights for the summer schedule to 104 flights from 94. The growth will mainly come from secondary cities like Coimbatore, Trivandrum and Vizag, where SIA will increase frequency. Six of the top eight routes for SIA are to Indian metros Bengaluru, Chennai, Delhi, Hyderabad, Kolkata and Mumbai where it has almost fully utilised its seat entitlements.