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SpiceJet slumps on buzz airports revoke credit facility

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Capital Market
Last Updated : Dec 05 2014 | 12:48 PM IST

SpiceJet fell 11.62% to Rs 16.35 at 11:09 IST on BSE on reports the Airports Authority of India has decided to put operation of SpiceJet on cash and carry basis.

Meanwhile, the BSE Sensex was up 18.32 points, or 0.06%, to 28,581.14.

On BSE, so far 1.36 crore shares were traded in the counter, compared with an average volume of 51.71 lakh shares in the past one quarter.

The stock hit a high of Rs 18.35 and a low of Rs 16.15 so far during the day. The stock hit a 52-week high of Rs 22.20 on 26 May 2014. The stock hit a 52-week low of Rs 11.10 on 13 August 2014.

The stock had outperformed the market over the past one month till 4 December 2014, rising 24.41% compared with 2.52% rise in the Sensex. The scrip had also outperformed the market in past one quarter, rising 41.87% as against Sensex's 5.45% rise.

The small-cap company has an equity capital of Rs 599.45 crore. Face value per share is Rs 10.

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According to reports, the Airports Authority of India (AAI) has decided to withdraw credit facility relating to airport user fees to the financially-embattled low-cost carrier SpiceJet at all airports in the country from Thursday, 4 December 2014, midnight. The move has been spurred by the mounting dues that the airline has to pay the AAI.

An airline is put on cash and carry mode when it is unable to clear its dues in the time specified by its vendor or when its dues mount beyond acceptable limit.

Reports suggest that the dues payable by SpiceJet to the Pune airport alone have mounted to nearly Rs 4 crore. The airline is currently operating one international and 10 domestic flights out of Pune to Bengaluru, Chennai, Delhi, Ahmedabad, Kochi, Goa and Hyderabad, besides Sharjah. Of these, two flights each operate to Bengaluru, Chennai and Delhi while the Sharjah flight operates four days a week, reports added.

On 28 November 2014, Rare Enterprises, a company owned by well-known institutional investor Rakesh Jhunjhunwala, bought 75 lakh shares, or 1.25% stake, of SpiceJet at Rs 17.88 per share.

SpiceJet reported a net loss of Rs 310.45 crore in Q2 September 2014, lower than net loss of Rs 559.49 crore in Q2 September 2013. Net sales rose 15.2% to Rs 1435.86 crore in Q2 September 2014 over Q2 September 2013.

SpiceJet is India's second largest airline by domestic passenger share.

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First Published: Dec 05 2014 | 11:08 AM IST

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