Civil aviation minister Praful Patel (left), Kingfisher Airlines CEO Vijay Mallya (centre) and John Leahy, coo (customers), Airbus, in New Delhi on Monday. Picture by Rajesh Kumar

New Delhi, May 7: Kingfisher Airlines chairman Vijay Mallya is interested in picking up a stake in low-cost carrier Air Deccan, though his plans may not be very immediate in nature.

“Am I interested (in buying stake in Air Deccan)? Yes. Am I imminently acquiring it? Not decided as yet,” Mallya told reporters at the Indira Gandhi International Airport in New Delhi.

“I don’t have any current plans to acquire Air Deccan,” he added.

Captain G.R. Gopinath, chief executive of Air Deccan, however, told The Telegraph: “With due respect, Mr Mallya is talking rubbish ... Air Deccan is not up for sale. We are actually bigger than Kingfisher and we operate in a different market (low-cost one).”

“If wishes were horses he (Mallya) could have this airline. But let me say we are not selling out to anyone,” he said.

Rumours that Kingfisher may take over or buy a stake in Air Deccan have been doing the rounds since mid-April. However, Air Deccan has been denying the rumours, while Kingfisher has been silent on the issue.

Mallya,whose Kingfisher Airlines is billed as a full-service carrier, had last year sought to acquire Air Sahara. But the deal fell through as Mallya felt Sahara was demanding too steep a price.

Jet Airways eventually picked up Air Sahara after an on-again-off-again deal that saw the two sides going to court over damages from a broken contract.

Post Jet’s takeover of Sahara, there has been speculation that a wave of mergers in India’s over-crowded airspace is in the offing. The number of airlines in India has jumped to 10 from just three in 2003.

Several carriers joined the fray to profit from a boom in air travel that is expected to more than double in domestic market size to 60 million passengers by 2010.

Air Deccan is India’s largest low-fare airline with over 350 daily flights and a fleet of new Airbus A320s and ATRs.

However, like most low- cost carriers across the globe, Deccan has been losing money. Market analysts consequently consider it a possible takeover target.

Captain Gopinath admitted his airline was losing money but said revenue models of low-cost carriers took into account losses in the initial years before pulling through after reaching a large enough size where scale of operations ensured better returns.

“We are waiting for a market shift which should happen in three to six months,” he said.

Media reports today suggested that one of the original promoters of Air Deccan wishes to exit the airline and was in talks with possible buyers, but not with Kingfisher Airlines. Even this had been denied by Air Deccan.

However, analysts speculate that if Kingfisher were to somehow manage to buy into Air Deccan, it would create an airline controlling 38 per cent of India's domestic aviation market with a combined fleet of 64 aircraft.