Buddha Air announces divestment programme
- Marking 21 years of operations
Oct 11, 2018-
Private carrier Buddha Air on Wednesday announced pursuing a well-planned divestment programme to enhance its operational and management efficiency as it plans to spread its wings and set course for exotic foreign destinations by 2020.
Birendra Bahadur Basnet, managing director of Buddha Air, said that under its focused capital investment plan for international operation, the company will own 30 percent of equity while 30 percent of shares will be allotted for public and remaining for strategic partnerships.
The company has not unveiled its total capital expenditure plan.
The carrier, however, said it has no plans to convert its domestic operation into a public limited company. “We have now grown to a 21-year-old company. And now, we want to create a far-reaching legacy of our brand. So we are well prepared to go for exotic foreign destinations,” said Basnet, addressing a press meet here on Wednesday. The company is celebrating its 21st anniversary on Thursday.
The carrier has been working on powering itself from one-hour to three-hour or beyond flights, and entering the long-haul international market. Buddha has set its sights on lucrative Asian destinations like Guangzhou, Bangkok, Dhaka and most major Indian cities in the first phase.
In the second phase, the carrier plans to connect Kathmandu with Moscow, Seoul and Japan directly.
As per the carrier’s plan, by March 2020, it will be flying to key Indian cities from Tribhuvan International Airport (TIA) after leasing two narrow-body jets.
“After operating for six months, we have planned to issue initial public offering (IPO). The six month period will be enough to convince potential strategic partners and the public about Buddha Air’s future path.”
By August 2021, the carrier plans add two jets and begin operations from the upcoming international airport in Pokhara. The construction of the modern airport in Pokhara is expected to be completed by July 2021.
In a question on why Buddha was not interested in flying from the upcoming Gautam Buddha International Airport, Basnet said, “We want to establish Pokhara as a premium tourist destination and the Lake City has the potential to become a key tourist destination.”
“We will not be focused on the labour market as we cannot compete with giant foreign airline companies currently serving Nepal. We want to impact the tourism market instead of the ever-increasing Nepali labour market. Our aim will be to bring high-end tourists.”
The carrier’s own study has revealed that the completion of the international airport in Pokhara will enable the lake city to host more than 2.5 million tourists annually by 2025.
“Imagine what impact tourism will create in Pokhara if 2.5 million tourists are brought in annually. The industry will not only create job opportunities but also link tourism with agriculture,” he said. For example, Pokhara will require 10 million eggs and tonnes of meats and vegetables to feed the visitors.
“Hence, it will create a surge in demand for agriculture products at a large scale,” Basnet said, adding that the government also needs to create policy to boost production. “But if we are solely dependent on imports from India to meet the demand, the tourism impact will not benefit locals.”
Buddha began commercial flights to Paro, Bhutan with an 18-seater Beechcraft in August 2010, becoming the first foreign airline to serve Bhutan. The carrier has been assessing the Boeing 737 MAX 8 narrow-body aircraft series for the international operation. However, it is yet to decide which model is suitable for the company.
- Company to launch IPO sometime in 2020
- Offer direct flights to key India cities by 2020
- To fly to destinations like Guangzhou, Bangkok, Dhaka in first phase
- To fly to Moscow, Seoul and Japan directly in second phase
- Fleet expansion to service international airport in Pokhara
- No plans to fly from Gautam Buddha Int’l Airport
Published: 11-10-2018 08:34