SpiceJet shares in focus today as promoter Ajay Singh to infuse Rs 500 crore

Shares of airline SpiceJet Ltd are in focus today after the airline said its promoter Ajay Singh would infuse Rs 500 crore into the airline by way of subscribing fresh equity shares and/or convertible instruments. SpiceJet shares ended 4.39% higher at Rs 32.18 on Wednesday against the previous close of Rs 29.85 on BSE.

The aviation stock opened flat at Rs 29.85 in the previous session today. The stock has lost 20% since the beginning of this year and has fallen 19.27% in a year. In terms of technicals, the relative strength index (RSI) of SpiceJet stands at 62.8, signaling it's trading neither in the overbought nor in the oversold territory. The stock has a beta of 0.9, indicating low volatility in a year.

A total of 55.13 lakh shares of the firm changed hands amounting to a turnover of Rs 16.59 crore on BSE. The market cap of SpiceJet rose to Rs 1875.35 crore. The stock hit a 52-week high of Rs 52.40 on August 3, 2022 and fell to a 52-week low of Rs 22.65 on May 23, 2023.

SpiceJet would be entitled to additional credit facilities of Rs 206 crore under the emergency credit line guarantee scheme (ECLGS) with the fund infusion by its promoter.

"This investment will allow the airline to accelerate its growth plans and capture new opportunities in the market, grow its revenue and profits. We are committed to building a sustainable and profitable business, and this investment is a reflection of that commitment," said Ajay Singh, Chairman and Managing Director, SpiceJet

"I am confident that SpiceJet, a powerful brand which has served passengers for over 18 years, will succeed in the long term and I am excited to be a part of this journey," he added.

The air carrier is already utilising $50 million ECLGS funds that it has received and own cash to revive its grounded aircraft. Two of the grounded aircraft, a Boeing 737 and a Q400, have been operationalised so far and more planes are expected to re-join the fleet soon

"The infusion of fresh capital will substantially strengthen the company's financial position and is a powerful vote of confidence in its future and long-term viability," the airline said, adding that "it marks a pivotal moment in SpiceJet's journey towards sustained growth and long-term success".

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