SpiceJet tanks 19%, crashes to near 8-year low on heavy volumes

Average trading volumes on the counter jumped over eight-fold with around 11.47 million equity shares, representing 1.9 per cen of total equity of SpiceJet changing hands on the BSE till 01:50 pm

Shares of SpiceJet were quoting close to an eight-year low of Rs 22.65, as they tanked 19 per cent on the BSE in Tuesday's intra-day trade amid heavy volumes. The stock of the airline company was quoting at its lowest level since June 2015.

At 01:50 PM, SpiceJet was trading 14.5 per cent lower at Rs 24.01, as compared to 0.36 per cent rise in the S&P BSE Sensex. The average trading volume on the counter jumped over eight-fold today with around 11.47 million equity shares, representing 1.9 per cent of total equity of SpiceJet, having changed hands on the BSE.

SpiceJet is an IATA-IOSA certified airline that operates a fleet of Boeing 737s and Q-400s, and is one of the country's largest regional players operating multiple daily flights under UDAN or the Regional Connectivity Scheme. The majority of the airline's fleet offers SpiceMax, the most spacious economy class seating in India.

The stock was quoting lower for the sixth straight trading day, having slipped 25 per cent during the period.

On May 11, SpiceJet announced that it has initiated the process of reviving its grounded fleet with the $50 million funds received by the airline from the government's Emergency Credit Line Guarantee Scheme (ECLGS) and internal cash accruals.

"In view of the recent developments in the Indian aviation market, the airline has categorically stated that it has no plans whatsoever to file for insolvency, the company said. “We want to scotch any speculation that may have arisen due to the filing by another airline. The airline is firmly focussed on its business and remains in active talks with investors to raise funds,” SpiceJet had said.

SpiceJet had announced plans to revive 25 grounded aircraft that will help it capitalise and make the most of the upcoming peak travel season.

"There is absolutely no question of filing for insolvency. Any rumour regarding the same is completely baseless. We are focussed firmly on reviving our grounded fleet and getting more and more planes back into the air. Work on this front has already begun and the Company is using the $50 million ECLGS funds and our own cash," said Ajay Singh, Chairman and Managing Director, SpiceJet.

Meanwhile, as the insolvency issue of SpiceJet heats up, prior red-flagging to the company by the Directorate General of Civil Aviation (DGCA) had pointed out long awaited trouble for the aviation giant, news agency IANS had reported on Monday, May 21.

Last year itself the DGCA had warned the airline after noticing various anomalies regarding its service. CLICK HERE FOR FULL REPORT