Turbulent times for India’s “King of Good Times”

NEW DELHI (Reuters): With one of the world’s most expensive yachts and a cricket and Formula One team, billionaire Vijay Mallya is known as India’s Richard Branson or simply, the “King of Good Times”.

Owner of the world’s second-largest liquor maker, it is his chairmanship of debt-ridden Kingfisher Airlines that is currently making headlines, not the usual write-ups in society pages of his jet set lifestyle.

Mallya, who prefers to be addressed as Doctor for his honorary Ph.D. in business administration, was typically pugnacious as Kingfisher looked headed for a financial disaster with mass cancellation of flights and the resignations of dozens of its pilots.

“I am absolutely committed to keeping the airline going unless some government agency wishes to ground it,” the silver-haired 56-year-old told reporters. “The point is our bank accounts have been frozen by income tax authorities very suddenly and that has crippled us.”

Mallya’s ascent to the forefront of India’s business elite has shadowed India’s own rise as an economic power. But his troubles coincide with the country’s slow growth, high inflation and corruption scandals.

His larger-than-life achievements, travels on his yacht, Scottish castle, beachfront mansion in Cape Town and general playboy image, fascinate many Indians aspiring for wealth after generations of forced frugality. But it jars with others in a country where around half live in poverty.

To cap his commercial achievements, Mallya was elected in 2010 to the upper house of India’s parliament as independent.

“While he was doing well, he was signifying the resurgence of India. To a very large part of the middle class, he was what everyone wanted to be,” said Prahlad Kakkar, a well-known advertising executive, recently. “He was the symbol of new India - flamboyant, high-risk, wealthy and not ashamed of it.

“Now when everyone is tightening their belts .. there is an eerie feeling that he’s irresponsible.”

Kingfisher has become one of the main casualties of high fuel costs and a fierce price war between a handful of airlines which, between them, have ordered hundreds of aircraft for delivery over the next decade in an ambitious bet on the future.

The airline has resorted to mass cancellations of flights in recent days and is using less than half of its fleet of 64. Mallya has blamed the cash crunch on tax authorities who have frozen Kingfisher’s bank accounts over outstanding dues.

Media reports have said that 50 Kingfisher pilots have resigned over the past week, taking to more than 300 the number that have quit since last September.

Mallya has vowed not to seek any bailout from the government but has been non-committal on whether he will plough any of his own funds into the airline.

He is also chairman of United Breweries (Holdings) , a conglomerate with interests as diverse as aviation, breweries, biotechnology and real estate. The group has annual sales of more than $4 billion and Forbes said last year Mallya had a personal fortune of $1.4 billion. But it is his ownership of Kingfisher Airlines, which use to fly one in five passengers in India’s domestic market, that perhaps made Mallya most famous . The airline’s share is now half that. He helped transform India’s airline business by focusing on services like good food, personal screens on domestic flights and airline ushers who attend to customers as they arrive at the airport. “He altogether brought a different level of service into the domestic skies,” said Kapil Kaul, chief executive for the Indian subcontinent and Middle East at the Centre for Asia Pacific Aviation (CAPA), an aviation consulting firm. On each flight, Mallya appears on a recorded message on the inflight entertainment system, boasting of hand-picking each of the airline’s hostesses who “have been instructed to treat you in the same way as if you were a guest in my own home”. His lifestyle fascinates many Indians, including the nearly one million that follow him on Twitter.

Mallya flies around the world, dining with football stars and Formula One drivers and appearing with models on photo shoots in locations like Mauritius, continuously name-dropping the rich and famous on his Twitter feed. His 312-foot yacht, the Indian Empress cost almost $89 million.

Highlighting his global ambition, Mallya also owns a Scottish whisky company. He once personally flew in his private jet from New Zealand to Scotland to deliver three precious bottles of whisky that had been found left behind by the 1907 Antarctic expedition of British explorer Sir Ernest Shackleton.

He built a luxury Kingfisher villa in the beach state of Goa famed for its lavish parties, has befriended Bollywood stars and has a collection of dozens of vintage cars worth millions. He publishes a Kingfisher calendar of beautiful Indian models - often appearing flanked by them in photoshoots.

Mallya was the son of Vittal Mallya, a liquor baron whose United Breweries was once a major supplier of British colonial troops in India. He soon made a fortune buying up breweries in the pre-economic reform decades of post-independence India.

Vittal Mallya died relatively young and his son Vijay took over the UB Group as chairman in 1983 at the age of 28 and quickly expanded the group. Its core breweries and liquor business has around half the market share in India. Mallya’s lifestyle is not without critics, with some saying it is directly linked to the airline’s problems.

“Mallya’s flamboyant lifestyle is responsible for the debts that Kingfisher Airlines has incurred,” radical Hindu leader Bal Thackeray was quoted as saying by local media last year. “He has many businesses -- liquor, IPL and F1 teams. He has many bungalows and a cruise boat. He himself does not know how much he spends on cheer girls during IPL (cricket) matches.”

The country’s main opposition party said it would oppose a state bailout for Kingfisher, which means pressure will remain on Mallya’s United Breweries to keep the airline in business. “Those who die must die,” Indian auto industrialist Rahul Bajaj told local media in November, referring to Kingfisher Airlines. Mallya himself says he will bounce back, and often criticises what he sees as a sensationalist press out to get him.

“Sensational headlines more speculative than fact-based,” he tweeted on Tuesday. “Self-styled expert commentators who are unqualified.”