Singapore Airlines to carefully consider fund infusion in loss-making Air India
Delhi/Mumbai: Singapore Airlines (SIA), which owns a quarter of Air India, said it would “carefully consider requests for additional capital” from the Tata Group carrier, marking the first public indication of its willingness to inject fresh funds into the loss-making carrier.
The Singapore flag carrier also reaffirmed its long-term commitment to its 25.1% stake in Air India.
“The Board will carefully consider any request for additional capital from Air India, taking into account the Group’s other capital requirements and Air India’s business strategy,” SIA said in a regulatory filing on Monday. he said.
In the filing, the airline responded to questions from the Securities Investors Association (Singapore), or SIAS, a registered charity and one of Asia’s largest investor lobby groups, as well as questions from shareholders ahead of its annual general meeting on July 24.
Investors, including SIAS, have questioned the logic behind Singapore Airlines’ investment in Air India due to the Indian carrier’s mounting losses.
Explaining the rationale for the investment, SIA said its stake in Air India complements its Singapore hub, providing direct access to the country’s domestic aviation market and international traffic flow through Indian hubs.
“SIA Group is also the only non-Indian airline group with a direct stake in this important and fast-growing market,” he said.
SIA said the capital allocation follows a “disciplined evaluation process” that takes into account operating cash flow, investment requirements for new aircraft and products, as well as strategic investments such as Air India.
Air India and Singapore Airlines have not yet responded to questions. Mint.
“Singapore Airlines’ language suggests a more measured approach to future capital commitments. Rather than signaling automatic support, it suggests that any new funding requests from Air India will be assessed against the group’s broader capital needs and Air India’s business strategy. This is a reasonable stance for a shareholder seeking greater accountability on returns,” said Gagan Dixit, senior vice president of oil, gas and aviation at brokerage Elara Securities.
The comments come after Singapore Airlines’ FY26 net profit fell by more than half, largely due to share of losses from Air India. The airline recorded a loss of S$945.2 million (approximately US$742.4 million) on its investment in Air India.
According to SIA’s annual report submitted in May, Air India had a net worth of approximately S$3.76 billion (about US$3 billion or ₹28,400 crore for FY26), almost three times the FY25 estimated loss. Air India, a private company, is expected to submit its earnings to the Ministry of Corporate Affairs next month.
“This should not be interpreted as a sign that Singapore Airlines is pulling back. It is more a reflection of prudent capital allocation. Investors naturally want to see operational improvements, a clearer path to profitability and evidence that previous investments are paying off before approving new capital,” Dixit said.
Air India’s FY26 losses, the country’s second-largest carrier with 25% market share, are expected to be more than 10 times that of market leader IndiGo, operated by InterGlobe Aviation, which reported a net loss. ₹2,400 crore.
The airline is also preparing for a leadership change, with chairman Campbell Wilson stepping down in September. The airline is still searching for his replacement. Air India brought back former chairman and chief executive Pradeep Singh Kharola to its senior management team, signaling the start of a planned leadership transition with Wilson’s departure.
Singapore Airlines has acknowledged that Air India continues to face numerous headwinds, including high fuel prices, the depreciation of the Indian rupee against the US dollar, aircraft supply chain disruptions, the continued closure of Pakistani airspace to Indian carriers and last year’s AI171 crash.
Despite these challenges, Air India has made “tangible progress” in its transformation program across customer experience, fleet and network expansion, products and services, and operational performance, it said.
As a significant minority shareholder, SIA said it is committed to supporting Air India’s transformation along with Tata Sons. He noted that chief executive officer Goh Choon Phong serves as a non-executive, non-independent director on Air India’s board, allowing both shareholders to provide strategic guidance as needed.
SIA also said it continues to provide aviation expertise to support Air India’s transformation and unlock its long-term potential.
The shift from 50% stake in Vistara to 25% stake in Air India also changes the dynamics. As a minority shareholder and also a listed entity, Singapore Airlines will likely seek stronger management, greater visibility into execution and clarity on how additional capital will be deployed before raising more funding, Dixit said.
Reaffirming its strategic commitment, SIA said: “SIA’s 25.1% stake in the expanded Air India Group is a key pillar of the Group’s multi-hub strategy.” He added that the investment reflects its confidence in India’s long-term aviation growth and builds on its decade-long presence in the country through Vistara, its former joint venture with Tata Sons, which merged with Air India in November 2024.
