Shares in India's SpiceJet rose nearly five percent on Tuesday as the airline confirmed foreign carriers had expressed interest in acquiring a stake.
Shares in SpiceJet, which has a 19.5 percent market share, closed up 4.75 percent at 45.85 rupees having at one stage climbed eight percent after it said a "few investors have evinced interest in the company", without giving names.
A Times of India report on Tuesday said Qatar Airways was "the most likely suitor" for the low-cost carrier, which was likely to see foreign direct investment in the current quarter to March.
But the airline itself said it would be "very premature to comment on the possibilities of any fresh equity issuance to such interested parties or confirm/deny names of any specific entity".
Speculation about foreign interest in Indian carriers has been brewing since the government in September said it would allow overseas airlines to take up to 49 percent stakes in domestic operators as part of a blitz of economic reforms.
Indian carriers need money to fund expansion and cut debt after several years of losses caused by fierce price battles and rising fuel costs.
Only one of India's six main scheduled carriers -- privately held low-cost carrier IndiGo -- was in profit last year, helped by a strict business plan and punctual performance.
Earlier this month, loss-making private Indian carrier Jet Airways said that it was in talks with Etihad Airways to sell a stake to the Abu Dhabi-based airline.
Aviation consultancy firm Centre for Aviation has said that low-cost SpiceJet and fellow low-cost GoAir were the carriers "with the greatest prospect" to attract foreign airline investment.