Trujet currently operates flights to 21 cities, including Hyderabad, Mumbai, Aurangabad, Chennai, Goa, Bengaluru, Tirupati, Vijayawada, Rajahmundry, Ahmedabad and Jaisalmer with a fleet of seven ATR aircraft.
“The funds raised through 49% FDI in the company, will be utilized to expand its operations pan India and explore the newer opportunities in the civil aviation sector," MEIL’s group director K.V. Pradeep and Interups’ chairman Palepu Lakshmi Prasad said in a joint statement.
“We will finalize the exact final amount at a later stage," the statement said.
When contacted, Prasad said confidentiality clauses prevent him from disclosing the company’s investment in Trujet. He said, however, that Interups will remain a long-term investor in TruJet.
Interups, which is eyeing stressed assets in India, had earlier shown some interest in bidding for the national carrier Air India Ltd.
The company, however, later chose not to submit an expression of interest (EoI). It was also in the running for Asian Colour Coated Ispat Ltd, which was eventually bagged by JSW Steel.
Interups had also shown interest in acquiring The Claridges hotel in New Delhi and another hotel in Mahabalipuram.
Interups’ Prasad had earlier told Mint that his company holds 27,635 qualified retirement asset accounts owned by US-based non-resident Indians.
Interups’ investment in TruJet comes at a time when airlines in India, including regional carriers, have been adversely impacted by the covid-19 pandemic, which has resulted in muted travel demand amid curbs on movement imposed by some states.
India’s air passenger traffic, which was adversely impacted by the covid-19 pandemic, is expected to rebound in the financial year 2021-22, though it will widely lag the levels that were seen in FY2016, credit rating agency Icra said recently.
“The investment will be a second lease of life for TruJet. But, the promoters will have to come up with a plan for expansion, profitability and growth for the airline," said aviation consultant Mark Martin, chief executive of Martin Consulting LLC.
“The promoters will have to make some prudent decisions, and perhaps get a strong leadership team to start with," he said.