Shares of aviation companies SpiceJet and InterGlobe Aviation got here below heavy promoting on Thursday after aviation turbine gas (ATF) or jet gas costs had been raised to a report excessive.
The inventory of SpiceJet tanked 7.05 per cent to settle at Rs 40.90 apiece on the BSE. In the course of the day, it tumbled 8.29 per cent to its one-year low of Rs 40.35.
InterGlobe Aviation, dad or mum agency of IndiGo, fell by 5.22 per cent to Rs 1,644.65 apiece. In the course of the day, the inventory declined 5.83 per cent to Rs 1,634.
On Thursday, jet gas costs had been hiked by the steepest-ever 16 per cent to catapult charges to an all-time excessive in keeping with hardening worldwide oil charges.
The sharp enhance in aviation turbine gas costs and depreciation of the rupee have left the home airways with no alternative however to right away increase airfares, mentioned Ajay Singh, Chairman and Managing Director, SpiceJet, on Thursday.
A minimal 10-15 per cent enhance in air fares is required to make sure that the price of operations are higher sustained, Singh mentioned in a press release.
The rise in jet gas value will increase the working value for airways. ATF makes as much as 40 per cent of an airline’s working value.
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