Businessman, Kalanithi Maran, who is the owner of India's popular low-cost passenger carrier SpiceJet, has said that he is planning to increase his holding in the company form 8 per cent to 16 per cent.

Maran as subscribed to 42.9 million preferential equity shares and will infuse about Rs. 100 crore. The new funds will allow the company to purchase new planes and it indicates Maran's confidence in the airline that is incurring looses at present.

SpiceJet chief executive officer Neil Mills said, "The equity infusion will be completed by the first week of April. It is a clear demonstration of promoter interest."

Maran said that the company is also looking at other options to raise capital, including raisng debt but the company had not taken a final decision on the matter yet. The airline had a total share capital of Rs 441 crore as of 31 December, 2011.

SpiceJet has been focussing on expanding in regional routes using the turbo prop planes but increasing fuel costs and competitive pressures have put a lot od pressure on ticket prices, something that had reduced the earnings.

The Indian aviation sector is seeing a difficult quarter and the falling value of rupee has contributed t the worsening condition. Some domestic carriers have been asking the government to relax its terms to allow foreign firms to invest more freely in domes airlines. The opening of the sector to foreign airlines for investments will bring in much needed funds for cash strapped carriers like Jet, Kingfisher and others.

The Department of Industrial Policy and Promotion (DIPP) under the Commerce Ministry has recommended allowing 26 percent foreign direct investment (FDI) by foreign airlines in domestic carriers. The government now allows
49 per cent FDI in Indian aviation companies, but do not allow foreign airlines to own stake in India's carriers.