The Mumbai stock exchange has given its approval for SpiceJet to raise capital amounting to ₹22.5 billion. This move is expected to provide the airline with the necessary funds to support its operations and growth plans. With the backing of the bourse, SpiceJet is now well-positioned to strengthen its financial position and pursue its strategic initiatives in the aviation industry.
The Bombay Stock Exchange (BSE) has given in-principle approval to SpiceJet (SG, Delhi International) for the issuance of equity shares and warrants convertible into equity shares on a preferential basis. The airline confirmed the approval in a January 15, 2024, filing.
SpiceJet shareholders approved the INR22.5 billion rupees (USD271.5 million) capital raise during a January 10 annual general meeting. The LCC will issue 318,300,000 equity shares at INR50 (USD0.60) each and 130,000,000 warrants at the same price. The filing says a substantial portion of the capital will fund SpiceJet’s growth, expand the network, reactivate grounded planes, and improve the airline's resiliency and competitiveness.
ʺThe in‐principle approval from BSE for the fund infusion is a crucial step for SpiceJet as we embark on a journey to enhance our capabilities and strengthen our position in the Indian aviation sector. We believe the fund infusion will open new avenues for SpiceJet," said SpiceJet Managing Director Ajay Singh. "It enables us to capitalise on potential opportunities and contribute to the growth of the aviation sector in India.”
With around half its fleet out-of-service and short of cash, SpiceJet experienced a tubulent 2023. According to ch-aviation fleets advanced data, 26 of its 64 aircraft remain out-of-service. Funds from the capital raising will go towards reactivating five B737-700s, one B737-700(BDSF), one B737-8, four B737-800s, two B737-900ERs, and fifteen DHC-8-Q400s.
Summary
This strategic move not only positions SpiceJet for future growth and expansion but also underscores its commitment to overcoming the challenges faced in the past year. The airline is poised to leverage these funds to strengthen its operational capabilities and contribute to the advancement of the Indian aviation industry.
(This article is sourced from ch-aviation.com curated by Thetransporteronline24)
