According to a report, Tata-owned Air India intends to borrow Rs 18,000 crore from State Bank of India (SBI) and Bank of Baroda (BoB) to short-term refinance its existing debt. According to the ET report, this debt will be a continuation of the facility that was utilized last year following the Tatas’ acquisition of the airline and will be utilized until a long-term debt strategy is developed.
According to a source with knowledge of the development, Tata has decided to maintain the existing borrowing arrangement for another year, despite the fact that they will eventually develop a long-term debt strategy. In keeping with the sharp rise in interest rates over the past year, the loans are being charged a higher rate than they were last time.
Since the airlines received loans from SBI and BoB in January 2022, the repo rate has been raised by 225 basis points, resulting in higher interest rates. Aside from rebuilding the tasks of Air India, Goodbye Gathering is likewise chipping away at combining its different units, including AirAsia India and Vistara. Vistara is co-possessed by the Goodbye Gathering and Singapore aircrafts.
Banks will therefore be waiting for a piece of this top-rated corporate loan sometime later in 2023, according to another person familiar with the situation who told ET. According to Reports, the airline is set to place an order for 190 narrow-body Boeing 737 MAX aircraft, 20 Boeing 787 aircraft, and 10 Boeing 777X aircraft on the anniversary of Tata Group’s acquisition of the former state-run carrier. This comes after months of tightly guarded and difficult negotiations.