The Enemy Lies Within

IIPM BUSINESS AND ECONOMY

While the whole nation was watching wide-eyed for the first bird to fall from the domestic skies, Naresh Goyal seized the opportunity and proved yet again why Jet Airways is such a hit with the media. Is the Sahara deal a brilliant strategic move to remain afloat? Or some unavoidable curse? For now, what matters is that Jet seems to be losing altitude... and fast!

Friday the 13th! Cursed, you said? Sure it is in Western culture, but could the association with this day find a parallel in the Indian aviation sector? For it is this fateful day in the year of 2007 that Jet Airways Chairman Naresh Goyal chose to finally announce that Jet & Sahara have finally decided to make it to the aisle; a move that has industry experts shaking their heads in candid disapproval of the strategic logic.

This one’s a no-brainer: What would you call a company that’s publicly-listed, but one in which the Chairman (who fits the title of ‘king’) commands a filthy 80% of total voting power, while the very public owns a practically negligible and hopelessly heart-rending 3.05% of total shares? Yes, it’s the erstwhile mighty Jet Airways we’re referring to, which survived when all other private fliers closed shops, led by its king and today a top(pled) gun, Naresh Goyal! Both form the perfect mishmash that proved ideal for a resounding malfunction on the bourses ever since it came out with its IPO. Ever since it got listed on NSE, Jet shareholders have found their total worth deplete by a dishonourable 54.7% to just Rs.45.5 billion as on April 13, 2006. So where is Jet headed in a business environment that’s nothing short of a bloody battle?

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Source : IIPM Editorial, 2007

An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative