SpiceJet shares jump as airline plans to raise funds worth ₹2,000 cr

SpiceJet Chairman and Managing Director Ajay Singh said the airline is looking to raise funds to the tune of ₹2,000 cr. The shareholders of SpiceJet, which is a listed company, have approved fundraising of ₹1,500 to ₹2,000 crore, and some of the amounts have already been raised, he said.

Singh also said it is doing the utmost to work through the stress that it has faced and the strategy is to raise resources.

“We are doing it by way of the government-supported scheme ECLGS, getting new aircraft from Boeing and therefore through the SLB process, exploring options for fundraise… we are exploring all options,” the SpiceJet Chairman said.

The domestic airline is pursuing multiple ways to raise funds including government lending schemes, stake or equity sale.

Without divulging specific details, Singh said the carrier would do everything to ensure it remains a strong and vibrant player.

SpiceJet loans ‘high risk’ for some lenders

Recently, three Indian banks internally categorised loans to SpiceJet as being at “high risk” though the airline has not defaulted.

IDFC First Bank, Yes Bank and Indian Bank are concerned about SpiceJet’s cash flows and have held talks with the carrier seeking assurances as it has been behind on payments to some aircraft lessors. 

However SpiceJet called the report false and baseless. “None of our banks has put our account on high risk or alert,” SpiceJet said in a statement. “The same has been confirmed to us by our lenders.”

The carrier plans to add at least seven more planes by December-end. At present, the company has 60 operational aircraft.

The firm has been under the scanner lately after several issues, including technical problems. On 27 July, aviation regulator Directorate General of Civil Aviation (DGCA) ordered the airline to operate a maximum of 50% of its flights for eight weeks in the wake of multiple incidents.

Recently, DGCA has suspended the licence of a SpiceJet pilot for six months following an incident where the airline’s flight from Mumbai to Durgapur had faced severe turbulence and resulted in injuries to many passengers in May.

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