SpiceJet plans to raise $250 million by mid-August, says Ajay Singh

The airline's shareholders had earlier this year approved the issuance of equity and warrants for raising Rs 2,241 crore, out of which the airline has raised Rs 1,060 crore to date

SpiceJet is planning to raise $250 million (Rs 2,085 crore) by mid-August as it would assist the airline in clearing its balance sheet and put it on the path of growth, its chairman and managing director Ajay Singh said on Wednesday.

For the last several quarters, SpiceJet has been grappling with a cash crunch amid multiple legal battles over unpaid dues to aircraft lessors, engine lessors, lenders and former promoter Kalanithi Maran.

The airline's shareholders had earlier this year approved issuance of equity and warrants for raising Rs 2,241 crore, out of which the airline has raised Rs 1,060 crore till date.

“We had one round of fundraise 2-3 months ago. We will have another round in the next couple of months. That will set us on the path of growth. We have got $150 million. We are going to raise another $250 million. We expect to do it by mid-August,” Singh said at CAPA India Aviation Summit 2024.

He said the airline is expecting to “clean its balance sheet” in the next two quarters. “It is very difficult to kill SpiceJet. We have a tendency to survive. Now, we are trying to grow again,” he said.

SpiceJet's network has decreased by about 70 per cent in the last five years and the carrier is currently operating 1,180 flights per week, according to aviation analytics firm Cirium.

Singh said the demand environment right now is excellent and wherever SpiceJet is putting its flights, it is finding no issues in filling them up. Currently, the airline has about 66 aircraft in its fleet.

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Speaking about the need to lower taxes, Singh said there is better understanding among the country's MPs regarding the importance of civil aviation for the common man.

He stated a significant number of MPs have been asking carriers to start flights to their constituencies.

“This has to be used in a constructive manner so that they understand the importance of lower taxes. Commercial aviation is no longer for just rich people,” he stated.

The airline has been posting annual losses since 2018-19. SpiceJet has been using various avenues to raise cash.

In 2022-23, the airline raised Rs 449.8 crore under the central government's Emergency Credit Line Guarantee Scheme (ECLGS). The airline has received an additional Rs 541.3 crore under the ECLGS in 2023-24, it had said on December 12, 2023.

In August 2023, Singh himself infused Rs 494.1 crore into the airline and his entities were issued fresh equity and warrants in return.

A few days later, aircraft lessor Carlyle Aviation Partners acquired 5.91 per cent stake in the airline for Rs 48 a share. The lessor got the shares after converting its existing outstanding dues of $28.16 million.