Vietravel Airlines (VU, Hue Phu Bai International) plans to increase its charter capital by almost six times its current size to VND7.64 trillion (USD323 million) by 2025 to enable it to acquire more aircraft, the chairman of its parent and leisure travel specialist Vietravel Holdings, Nguyễn Quốc Kỳ, has told the newspaper Người Lao Động and the online daily VnExpress.

The airline’s business plan then foresees raising its charter capital to VND8.25 trillion (USD348 million) by 2030. By that time it could have reaped, if business is favourable, VND2.2 trillion (USD93 million) in accumulated profits which could be used to inflate its capital still further.

It is currently in talks with lessors to secure more aircraft, Kỳ told Người Lao Động.

Vietravel Airlines initiated its certification drive in 2019 before conducting its first commercial flight amid pandemic travel restrictions in December 2020. According to the ch-aviation fleets module, it now operates a fleet of three leased A321-200s.

The chairman said the airline had recently proposed the radical charter capital raise to the Vietnamese government after more than two years with VND1.3 trillion (USD55 million). Vietravel Airlines remains unprofitable but thinks that a bigger fleet will help it better exploit an expected surge in post-Covid travel demand.

“Investing in fleet expansion is important for a new airline to survive and grow,” Kỳ told VnExpress. “Only with a large fleet can we make profits.”

The capital increase will occur through shareholder investment - an additional VND700 billion (USD29.5 million) by 2025 will take current shareholders’ total investment to VND2 trillion (USD84.5 million) - as well as selling minority shareholdings to outside investors and other financial tools, he said. Vietravel Holdings currently owns 85.8% of Vietravel Airlines’ shares.

Vietravel Airlines opened its first international scheduled route at the end of December 2022, between Hanoi Noi Bai International and Bangkok Suvarnabhumi, 7x weekly, and is expected to launch Ho Chi Minh City-Bangkok on February 9. According to the ch-aviation capacities module, it also operates four domestic routes, Hanoi-Da Nang (14x weekly) and between Ho Chi Minh City and Da Nang, Hanoi, Phu Quoc and Qui Nhon (all 7x weekly).

For now, the airline aims to target countries in the region, to carry tourists to Viet Nam from Southeast Asia and Northeast Asia, Kỳ said.