While Tata-SIA and Hindujas are expected to be the two bidders left in the fray for 40 per cent stake in AI, in case of IAs' 26 per cent stake, it may be Videocon International and Hindujas.

It is learnt that the Sky Team led by Air France has not been able to find a domestic partner and may not bid for AI. Industry sources said earlier Air France had held talks with tobacco major ITC, but was not able to convince it for a tie-up.

February 23 was the last date for submitting the technical bids for both AI and IA.

These bids have come in the midst of speculations that the civil aviation policy may be reviewed and government may hike foreign direct investment (FDI) cap to 49 per cent. This comes in the wake of a group of ministers recommendation for a hike in FDI in the civil aviation sector.

However, the civil aviation ministry is not in favour of these proposals. "We do not want to change the rules now.....the entire disinvestment process will get delayed and will have to be reworked if this happens," government sources said.

In the case of IA, Videocon International is in talks with a US company for a strategic alliance in its bid to acquire 26 per cent stake in the domestic carrier. "We may finalise a technical partner later, but we have submitted our bid on Friday", a company official said.

In the case of Tatas, an official spokesman of the group said, "we are not submitting our bid for IA". The second bidder for AI stake, Hindujas are believed to be in talks with German airline Lufthansa for a pact. It is understood that the other bidders, Emirates and LN Mittal, have already decided not to bid for AI, though there has been no official communication from them. In AI, the government has invited a strategic partner for its proposed 40 per cent equity stake sale in AI, of which 26 per cent may be held by foreign airline(s), non-resident Indians and overseas corporate bodies.

The balance 14 per cent Indian holding should be held by Indian nationals other than NRIs/OCBs and/or Indian companies registered under the Companies Act, 1956 which are majority owned and effectively controlled by Indian nationals.

For Indian Airlines, the government has invited a strategic partner for divesting its 26 per cent equity stake. The strategic partner may be an Indian company or an NRI.