According to a news report, India’s newest airline, Akasa Air, plans to raise $75-100 million by offering fresh shares to expand its business.

To raise funds, the airline has contacted possible investors such as private equity firms and high-net-worth individuals. Any cash infusion will be predicated on a $650 million valuation. Akasa Air will use the money to cover pre-delivery payments for the 72 Boeing 737 Max aircraft it bought, of which 19 have been delivered.

Co-founded by late billionaire investor Rakesh Jhunjhunwala in December 2021, it started its first commercial flight between Ahmedabad and Mumbai on August 7, 2022. The Jhunjhunwala family’s 46% stake in the airline will be diluted following the fresh issue.

The trust which holds the family’s stake will not participate in the funding round and will remain the largest shareholder in the company, even after the dilution, the report cited. A source said the Jhunjhunwala family has the right of first refusal on any equity fundraising the airline plans.

US-based hedge fund PAR Capital Management is one of the names doing the rounds and may subscribe to the shares to add to its existing 6% stake in the low-cost airline.

The airline has 19 aircraft in its fleet and a 4% market share. CEO Vinay Dube said the company was looking to place a triple-digit aircraft order before the end of 2023.