Jet Airways gains over 3% in two days

Jet Airways (India) rose 1.95% to Rs 332.10 at 10:31 IST on BSE, extending Wednesday's 1.62% rise triggered by the company announcing closure of a Rs 2069 crore deal for Etihad to pick up 24% equity in the Indian airline.

The announcement was made during trading hours on Wednesday, 20 November 2013. Shares of Jet Airways (India) rose 1.62% to Rs 325.75 on Wednesday, 20 November 2013. The stock rise up 3.60% in two sessions from Rs 320.55 on Tuesday, 19 November 2013.

Meanwhile, the BSE Sensex was down 229.62 points, or 1.11%, to 20,405.51.

On BSE, 2.97 lakh shares were traded in the counter compared with average volume of 5.16 lakh shares in the past one quarter.

The stock hit a high of Rs 337.60 and a low of Rs 330.05 so far during the day. The stock hit a 52-week high of Rs 688.60 on 25 April 2013. The stock hit a 52-week low of Rs 280 on 28 August 2013.

The stock had underperformed the market over the past one month till 20 November 2013, sliding 6.37% compared with the Sensex's 1.19% fall. The scrip had also underperformed the market in past one quarter, rising 7.65% as against Sensex's 13.09% rise.

The small-cap company has an equity capital of Rs 86.33 crore. Face value per share is Rs 10.

Jet Airways (India) and Etihad Airways, the national carrier of the United Arab Emirates, on Wednesday, 20 November 2013, announced that both airlines closed the transaction for the subscription of a 24% equity stake by Etihad Airways in Jet Airways. All requisite Indian regulatory approvals had been obtained by 12 November 2013. Jet Airways has on 20 November 2013, issued and allotted 2.7 crore shares of a face value of Rs. 10 each at a price of Rs. 754.7361607 per equity share on a preferential basis to Etihad Airways.

Consequent to the above allotment, the paid up share capital of Jet Airways stands increased to 11.35 crore shares of Rs 10 each. Following this issue and allotment of the said equity shares on a preferential basis to Etihad Airways, Etihad Airways holds 24% of the post issue paid up share capital of Jet Airways (on a fully diluted basis).

Additionally, Mr. James Hogan and Mr. James Rigney, being nominee directors of Etihad Airways, have been appointed as additional directors on the board of directors of Jet Airways from 20 November 2013.

Mr. Naresh Goyal, Chairman of Jet Airways said: "The infusion of foreign direct investment in the aviation sector will result in economies of scale, grow traffic at our airports, and create job opportunities. I am confident that this investment will greatly benefit all our stakeholders whilst significantly benefitting our customers who will now have access to a more expanded global network."

Mr. Goyal also stressed that together with Etihad Airways, Jet Airways would enhance connectivity for tourists, business travellers, Indian families and the wider travelling public.

Mr. James Hogan, President and Chief Executive Officer of Etihad Airways said: "India is one of the largest and fastest-growing markets in the world and a key part of the Etihad Airways growth strategy. Through this association, Etihad Airways and Jet Airways will both be strengthened, as will the economies of India and the UAE. By linking our two networks and adding new flights, new routes and more code-share options, travel to, from and within India will become much easier."

Mr. Goyal and Mr. Hogan confirmed that the collaboration between the airlines would commence immediately with a view to delivering network and service benefits to customers as soon as possible. Specific details will be released progressively.

Jet Airways (India) also said after market hours on Wednesday that the board of directors of the company has approved the sale of the Jet Privilege Frequent Flyer Programme business of the company to its subsidiary, Jet Privilege as a going concern on a slump sale basis. The company and Etihad Airways PJSC have also agreed to make equity investment in Jet Privilege following which Jet Privilege will become 50.1% owned by Etihad Airways PJSC (with Jet Airways holding approximately 49.9%).

The consummation of the transaction is subject to the approval of the Competition Commission of India and will only be effected after receipt of such approval, Jet Airways said.

Jet Airways (India) posted a net loss of Rs 891.01 crore in Q2 September 2013, higher than net loss of Rs 99.67 crore in Q2 September 2012. Total income rose 1.74% to Rs 4267.77 crore in Q2 September 2013 over Q2 September 2012.

Jet Airways currently operates a fleet of 113 aircraft, which include 10 Boeing 777-300 ER aircraft, 10 Airbus A330-200 aircraft, 4 Airbus A330-300 aircraft, 72 next generations Boeing 737-700/800/900/900 ER aircraft and 15 ATR 72-500 and 2 ATR72-600. With an average fleet age of 5.19 years, the airline has one of the youngest fleet of aircraft in the world. Flights to 76 destinations span the length and breadth of India and beyond, including Abu Dhabi, Bahrain, Bangkok, Brussels, Colombo, Dammam, Dhaka, Doha, Dubai, Hong Kong, Jeddah, Kathmandu, Kuwait, London (Heathrow), Muscat, New York (Newark), Riyadh, Sharjah, Singapore and Toronto.

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