SpiceJet Share Price Gains Over 3 Per Cent Following Rs 500 Crore Infusion By Ajay Singh
At 11.20 am on Thursday, SpiceJet was trading at Rs 32.19, up (Rs 1.03) 3.31 per cent on the BSE
SpiceJet’s shares gained considerably during early trade on Thursday after airline’s promoter Ajay Singh has decided to infuse Rs 500 crore into the airline, the company announced on Wednesday. At 11.20 am on Thursday, SpiceJet was trading at Rs 32.19, up (Rs 1.03) 3.31 per cent on the BSE.
SpiceJet’s capital infusion aims to strengthen the company's financial position amid multiple headwinds. In a statement released on Wednesday, the airline said that the fresh equity investment will also enable SpiceJet to avail additional credit facilities of Rs 206 crore under the Emergency Credit Line Guarantee Scheme (ECLGS).
According to the statement by the airline, "The board of directors of SpiceJet in its meeting held on July 12, 2023, considered options for raising fresh capital for the company wherein Ajay Singh, Promoter of the company in order to strengthen the financial position of the company offered to infuse Rs 500 crore by way of subscription to equity shares and/or convertible securities/equity share warrants on preferential basis along with promoter group of the company."
Ajay Singh, chairman and managing director, SpiceJet, said, "I am pleased to announce that I will infuse Rs 500 crore into the company. SpiceJet has a bright future and I am committed to helping it achieve its full potential. 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."
SpiceJet is already utilising $50 million in funds received from the ECLGS as well as its own cash reserves to restore its grounded aircraft. As of now, the airline has successfully revived two aircraft, a Boeing 737 and a Q400, and plans to bring more planes back into service in the near future. This initiative is aimed at strengthening the airline's fleet and enhancing its operational capacity.
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