Jet Airways hits 52-week low; stock down 53% in 2016

The stock was down 3% at Rs 332 on the BSE, its lowest level since October 12, 2015

Jet Airways hit 52-week low of Rs 332, down 3% on the BSE in intra-day trade. The stock is currently trading at its lowest level since October 12, 2015.

In 2016, the stock has underperformed the market by falling 53% from Rs 702 at the beginning of the year as compared to 1.2% decline in the S&P BSE Sensex.

Jet Airways reported 32% year on year drop in its consolidated net profit of Rs 211 crore during the first six months (April-September) of financial year 2016-17 (FY17). It had profit of Rs 309 crore during the same period FY16.

The company posted net profit of Rs 1,212 crore in entire previous financial year FY16, due to robust growth in passenger traffic and the significant reduction in jet fuel prices.

The rating agency ICRA believes that passenger growth potential in India remains high in the long-term; however due to lack of any immediate support from the core growth drivers, the demand pull and resultantly pricing power of the airlines would remain limited in the near term.

“While we expect domestic airlines to continue to report improved performance in FY2017, albeit lower than that in FY2016, on account of benign jet fuel pricing environment and cost rationalisation measures being undertaken by the airlines, the Indian carriers have been under severe financial stress due to a combination of weak operating performance and high investment requirements,” ICRA said in recent report.