Shares of SpiceJet plunged 17.31 per cent to hit a low of Rs 23.21 on BSE. This was the sixth straight day of fall for SpiceJet shares. The stock has fallen 22.90 per cent during the period.
SpiceJet's stock witnessed a significant decline of 17 percent during Tuesday's trading session, extending its consecutive streak of losses to the sixth day. The National Company Law Appellate Tribunal (NCLAT) dismissed a plea put forth by lessors against both SpiceJet, a renowned low-cost carrier, and its counterpart Go First, in their pursuit to reclaim possession of the aircraft.
The NCLAT, presided over by Justice (retd) J Ashok Bhushan and Justice (retd) Naresh Salecha, opined that the petitioners have the option to approach the National Company Law Tribunal (NCLT) to seek the desired relief. This outcome was in line with expectations, as the higher appellate tribunal likely intended to avoid contradicting the NCLT's verdict in a significant case pertaining to the Insolvency and Bankruptcy Code (IBC) in the context of an airline company, as reported by BT.
On May 17, the National Company Law Tribunal (NCLT) announced its intention to address an insolvency petition filed by aircraft lessor Aircastle against SpiceJet on May 25. This impending hearing may potentially pose a concern for investors of SpiceJet, as it could have a negative impact on the company's operations and financial stability.
SpiceJet experienced a significant decline in its stock, plummeting by 17.31 percent and reaching a low of Rs 23.21 on the BSE. Coincidentally, Tuesday marked the 18th anniversary of SpiceJet, during which the airline announced a promotional sale featuring one-way domestic fares starting at Rs 1,818. This downward trend in SpiceJet's shares continued for the sixth consecutive day, with the stock witnessing a cumulative decline of 22.90 percent over this period.
In a previous development this month, SpiceJet unveiled its strategy to reinstate 25 of its grounded aircraft into active service. Specifically, the airline disclosed on Tuesday its aim to reintroduce four of these grounded planes—two Boeing 737s and two Q400s—back into operation by June 15. This effort signifies SpiceJet's endeavor to enhance its fleet capacity and resume operations for a portion of its grounded aircraft.
More planes will be back in operations in the following weeks, it said.
SpiceJet has outlined its plans to initiate several new flight routes, including two international UDAN (Ude Desh ka Aam Nagrik) flights, namely the Agartala-Chattogram-Agartala and Imphal-Mandalay-Imphal sectors, which are expected to commence operations by the end of June. Additionally, the airline intends to introduce a new UDAN flight route connecting Kolkata, Tezpur, and Kolkata, as well as resume flights on the Kolkata-Gwalior-Kolkata and Jammu-Gwalior-Jammu UDAN routes. SpiceJet further disclosed its intentions to launch flights on the Kolkata-Agartala-Kolkata and Kolkata-Imphal-Kolkata sectors, in addition to resuming operations on the Kolkata-Chattogram-Kolkata sector. These strategic moves demonstrate SpiceJet's commitment to expanding its flight network and catering to the travel demands of various destinations.Regarding Go First, the Mumbai-based airline caused a stir in the global aviation industry by filing for a 'voluntary bankruptcy resolution' with the NCLT on May 2. The company cited technical issues with next-generation engines supplied by Pratt & Whitney as the cause of disrupted operations, resulting in significant financial losses. This development brought attention to the challenges faced by the airline and its decision to seek legal resolution to address its financial and operational difficulties.
According to reports from BT, numerous lessors from different parts of the world have already approached multiple Indian courts, such as the NCLT, NCLAT, and the Delhi High Court, in an attempt to reclaim their aircraft assets. However, in light of the recent developments on Monday, it has become evident that the ultimate legal battle will take place in the Supreme Court of India. Lawyers representing the affected leasing firms are anticipated to file a petition for an urgent hearing before a vacation bench of the apex court, highlighting the significance and urgency of the matter at hand.