Vijay Mallya-owned Kingfisher Airlines has upwardly revised its plans to raise up to Rs 5,000 crore (approximately $1 billion) from $100 million announced last year through various instruments including preferential issue, global depository receipts (GDRs) and rights issue.

On Tuesday, the board passed a resolution in this regard at its meeting. Simultaneously, the company will seek shareholders’ approval to increase authorised share capital from Rs 1,000 crore to Rs 4,250 crore, Kingfisher Airlines said in an announcement to the stock exchanges.

Experts say the fund raised will be utilised to retire debt of over Rs 6,000 crore.

“The board has approved, subject to shareholders’ approval, an increase in authorised equity share capital from Rs 900 crore to Rs 1,650 crore and an increase in authorised preference share capital from Rs 100 crore to Rs 2,600 crore,” the company said in a separate press statement issued on Tuesday.

Last year, Kingfisher Airlines had planned to increase authorised share capital of the company from Rs 500 crore to Rs 1,000 crore.

Kingfisher plans to raise up to $250 million by way of GDR and a further Rs 500 crore through a domestic offering subject to necessary regulatory approvals. “This funding is expected to be completed within the next three to four months,” the statement said.

It said United Breweries (Holdings), the promoting company of Kingfisher Airlines, would be converting approximately Rs 650 crore loans into preference share capital.

The financials of Kingfisher Airlines are expected to be strengthened significantly due to these initiatives,” the company said.

“Raising so much money will be challenging for the company. But for the aviation sector, this is the right time to raise funds,” said Nikhil Vora, an aviation analyst at IDFC Securities.

Kingfisher carried over 8.5 lakh passengers with occupancy of around 80 per cent last month.