Akasa Air Secures ₹450 Crore via Compulsory Convertible Preference Shares from Existing Investors

NEW DELHI: Akasa Air has raised ₹450 crore through the issuance of compulsory convertible preference shares to its existing investors. The funding round was approved by the airline's shareholders during an extraordinary general meeting (EGM) held on September 30.

This marks the second fundraise for the airline since last August. The capital infusion comes at a time when the aviation sector faces a tough operating environment, characterized by crude oil prices exceeding $100 a barrel and a weak rupee.

Company filings indicate that the convertible shares were issued to 29 individuals and entities during the September fundraise. This group includes the Jhunjhunwala family along with the family offices of Azim Premji and Ranjan Pai. Notably, Rekha Rakesh Jhunjhunwala invested ₹217 crore, accounting for nearly half of the total amount infused. Meanwhile, Azim Premji's family office contributed ₹94 crore to the round.

A source indicated that the company is continuing to raise capital, with new investors expected to come on board in subsequent rounds.

In a statement, the airline noted that the funds are being raised to support growing operations and meet operating expenses. However, the company did not provide a detailed breakdown of how the capital will be utilized across specific functions.

The fresh funds are critical for the carrier's ongoing expansion strategy. Akasa Air has inducted 14 Boeing 737 Max aircraft, bringing its total fleet count to 45, with further deliveries slated for the coming months.

While the airline has expanded its domestic market share to over 5.5 per cent, the rapid growth has also placed a strain on its financial metrics. For FY26, the company reported a 35 per cent increase in revenue, but its net loss widened by 37 per cent to ₹2,716 crore, heavily influenced by a weak rupee.

Industry observers note that broader macroeconomic headwinds continue to impact the sector. An industry watcher stated that rising fuel prices have impacted all airlines, while adding that management remains confident in its business plans as long as aircraft delivery schedules remain undisrupted.

"Raising capital from existing backers during a high-cost operating environment demonstrates continued investor confidence in Akasa Air's long-term business strategy. As the airline scales its fleet and expands its market share amidst headwinds like rising fuel prices and currency fluctuations, careful cash flow management and steady execution will be critical to balancing growth with financial sustainability." — Dr. Shishir Gupta, Founder & CEO, StartupLanes