SpiceJet Ltd , India's second-biggest budget airline, posted an unexpected quarterly profit on Monday as more passengers pushed up revenue, raising hopes of turnaround in the country's embattled aviation industry and lifting airlines stocks.
Indian carriers are reeling under debt of $20 billion, and had lost a combined $2 billion last year as higher fuel and airport expenses and below-cost fares hurt. All but IndiGo, India's top low-fare airline, lost money.
SpiceJet shares were up as much as 16.7 percent after its profit announcement, while those of market leader Jet Airways rose 7.2 percent. Shares of ailing Kingfisher Airlines gained 3.7 percent.
SpiceJet posted a profit of Rs 56.15 crore for the quarter ended in June, compared with a loss of Rs 71.96 crore a year earlier.
Revenue surged 51 percent Rs 1,407 crore.
Analysts had expected the carrier to post a loss of Rs 35.59 crore for the quarter, according to Thomson Reuters StarMine.
SpiceJet cautioned in a statement that expensive fuel, mostly due to local taxes, and a weak rupee, combined with high airport charges, continued to hurt the sector.