Naresh Goyal-promoted Jet Airways is said to be in advanced stage of talks with Middle East carrier Etihad Airways for a 24 per cent stake sale, which will generate an estimated of $400 million, or Rs 2,200 crore, for the Indian carrier.

A senior aviation source revealed that Jet Airways is in need of capitalization to fund its massive expansion plans. The source also expressed hope that the deal could be clinched shortly.

Revealing the development, the source said, "Jet Airways is in a massive expansion mode and needs capitalization. They are in advanced stage of talks with Etihad. This deal is expected to be clinched shortly unless Goyal or Etihad set up some impossible demand."

Jet Airways could become the first Indian airline company to benefit from the union government's recent change in the foreign direct investment (FDI) policy that allows foreign investors to invest in domestic civil aviation companies.

SpiceJet, another low-cost Indian carrier, has also announced that it is pursuing talks with a few foreign airlines/investors for a stake sale. Various reports suggest that two foreign airline and three foreign non-airline companies have shown interest in SpiceJet. However, the domestic carrier declined to reveal the names of the foreign companies interested in acquiring a stake in its business, saying it would be premature to comment about the talks.

The stock of Jet Airways hit 52-week high on Bombay Stock Exchange (BSE) by gaining 10.8 per cent to close at Rs 560 a share on Monday. SpiceJet shares jumped almost 13 per cent to hit a 52-high of Rs 46.9 apiece.