Airline stocks see volatility, settle in red zone

Airline stocks witnessed volatility today and settled in the negative territory even as official data showed that domestic passenger traffic grew 21 per cent in July, year-on-year.

During the day the stocks had surged as much as 3 per cent but pared gains and settled the day in the negative territory.

According to the data, domestic airlines carried 115.57 lakh passengers in July this year.

Separately, amid Jet Airways facing turbulent times, Civil Aviation Minister Suresh Prabhu made it clear that private airlines have to deal with issues facing them on their own and the government's role can only be at the policy level.

The minister's comments have come at a time when the airline industry is grappling with tough times as high oil prices and stiff competition are crimping the profitability of carriers.

Shares of InterGlobe Aviation opened at Rs 1,075, then gained further ground and touched a high of Rs 1,106, up 1.86 per cent over the previous close. The stock finally settled at Rs 1072.90, down 1.18 per cent on BSE.

SpiceJet stock also opened on a strong note and touched a high of Rs 87.20, up 3.01 per cent over its last close but finally ended the day at Rs 82.20, down 2.89 per cent.

Shares of Jet Airways however had opened on a weak note at Rs 297.80, then fell to a low of Rs 289.95, down 3.73 per cent over its previous closing price and finally was quoted at Rs 292.35, down 2.94 per cent.

Budget carrier IndiGo continued to be the largest player with a market share of 42.1 per cent while that of national carrier Air India stood at 12.4 per cent in July.

Last month, the market share of SpiceJet and GoAir stood at 12.3 per cent and 8.9 per cent, respectively. Jet Airways garnered a market share of 13.6 per cent in July.

India is one of the fastest growing aviation markets in the world and has been registering double-digit growth for more than three years.