SpiceJet becomes the best performing airline stock in the world

Indian air carrier SpiceJet's shares surged 124 per cent in 2017, becoming the best performer on the Bloomberg Intelligence index, reported Bloomberg on Monday.

The stock of SpiceJet rose 0.2 per cent to 128.30 rupees as of 9:30 a.m. in Mumbai on Tuesday. Today, the stock dipped 0.45 per cent on the BSE.

Ajay Singh, Chairman of SpiceJet, said that the scrip is "greatly undervalued" even at these levels, reported Bloomberg TV. Further, he added that only 3 per cent of Indians fly which lays out a great scope for growth, thereby ruling out the option of selling any stake of the company.

Analysts from Bloomberg attributed the air carrier's rise to Singh's capital drive and loss-reduction measures amid low crude oil prices.

The airline gained more than 800 per cent, creating a $1.2 billion market value since its plunge in December 2014 when the airline was forced to ground its flights over dispute with fuel retailers who terminated fuel supply over non-repayment of past dues.

Now, the company has received praise from US President Donald Trump over the order deal of new planes from US. The President called the order one of the "largest of its kind" and said it would help create jobs in the US.

Spice Jet has placed an order of  $22-billion for Boeing planes which is likely to help create more jobs in the aviation sector in the US. "This is a $22-billion order and these planes will be manufactured in the US. As per the US Department of Commerce, it creates 132,000 high-skilled, high-paid American jobs within the US," SpiceJet Chairman Ajay Singh said.

SpiceJet has also announced an order for the latest variant of Boeing's workhorse 737 model worth $4.7 billion on June 19 followed by the announcement of an order for as many as 50 Bombardier Q400 turboprops worth $1.7 billion.

Aircraft manufacturers Boeing Co and Airbus SE see growth potential from the rising middle class. Additionally, India figured as the world's fastest growing aviation market in 2016 which have increased their interest in the Indian markets.