Shares of air carriers such as SpiceJet and InterGlobe Aviation fell up to 4 per cent in early trade today after the oil marketing companies (OMCs) announced a hike in the aviation turbine fuel prices with effect from June 16 (Thursday).
Stock of SpiceJet slipped 3.97 per cent to Rs 42.25 (52-week low) against the previous close of Rs 44 on BSE.
The airline stock has been falling for the last four days. SpiceJet shares are trading lower than 5-day, 20-day, 50-day, 100-day and 200-day moving averages
In a year, the SpiceJet stock has lost 45.5 per cent and fallen 38 per cent this year.
A total of 1.39 lakh shares of the firm changed hands amounting to a turnover of Rs 59.55 lakh on BSE. The market cap of the firm fell to Rs 2,551 crore on BSE.
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Shares of another airline InterGlobe Aviation fell 0.81 per cent to Rs 1721.15 against the previous close of Rs 1735.30 on BSE. InterGlobe Aviation stock is trading lower than 5-day, 20-day, 50-day, 100-day and 200-day moving averages.
InterGlobe Aviation stock has lost 0.23 per cent in a year and fallen 14.13 per cent this year.
A total of 0.43 lakh shares of the firm changed hands amounting to a turnover of Rs 7.40 crore on BSE. Market cap of the firm fell to Rs 66,720 crore on BSE.
After the current hike, jet fuel prices have reached an all-time high. For domestic airlines, ATF cost Rs 1,41,232.87 per kl in Delhi; Rs 1,46,322.23 per kl in Kolkata; Rs 1,40,092.74 per kl in Mumbai; and Rs 1,46,215.85 per kl in Chennai.
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SpiceJet has expressed concerns over the hike in ATF prices.
The airline's CMD Ajay Singh said that aviation turbine fuel prices have gone up by more than 120 per cent since June 2021, while adding this increase in ATF is sustainable for airlines and central and state governments need to take action to reduce taxes.
"We have in the last few months tried to absorb as much burden of this fuel price rise, which constitutes more than 50% of our operational cost, as we could. The weakening of the Indian rupee against the US dollar further significantly impacts airlines as our substantial cost is either dollar-denominated or pegged to the dollar," Singh said.
ATF rates are revised on the first and 16th of every month on the basis of equivalent rates in the international market and local taxes.