 "Spicejet")
The airline added that it aims to restore its reputation for efficiency and reliability, ensuring improved connectivity for passengers with the recent capital infusion |(Photo: Shutterstock)
Low-cost airline SpiceJet on Monday announced that it has raised Rs 3,000 crore through a Qualified Institutional Placement (QIP) from global investors and mutual funds, as the firm said it wants to restore its reputation for “efficiency and reliability”.
The airline also said it will receive an additional Rs 736 crore from a previous funding round with a view to improve its financial stability and support growth plans.
With the latest capital infusion, the firm plans to strengthen its operations, expand its fleet, and extend its network to service passenger demand in the country.
The SpiceJet stock surged 7.45 per cent in intra-day trades on Monday to Rs 71 levels.
The QIP, which opened on September 16 and closed on September 18, saw the participation of global investors and mutual funds including players such as Goldman Sachs (Singapore), Morgan Stanley Asia, BNP Paribas Financial Markets ODI, Nomura Singapore Ltd ODI, Tata Mutual Fund, Discovery Global Opportunity Ltd, among others.
The airline added that it aims to restore its reputation for efficiency and reliability, and ensure that passengers have access to improved connectivity with the recent capital infusion.
“We extend our deepest gratitude to the Ministry of Civil Aviation, the regulators, and all those who supported us throughout this challenging journey,” said Ajay Singh, chairman and managing director (CMD), SpiceJet.
The QIP comes as the airline’s domestic market share continues to shrink and it faces financial difficulties.
The domestic passenger market share of the airline had shrunk to just 2.3 per cent in August this year, as per the data released by the Directorate General of Civil Aviation (DGCA).
It carried a total of 302,000 domestic passengers in August, which was 44.2 per cent lower year-on-year.
In January last year, the airline held a 7.3 per cent market share.
For the last several quarters, the low-cost carrier has been grappling with a cash crunch amid multiple legal battles over unpaid dues to aircraft lessors, engine lessors and lenders.
The Gurugram-headquartered airline reported a 20 per cent year-on-year (Y-o-Y) decline in consolidated net profit to Rs 158.1 crore in the first quarter (Q1) of 2024-25 (FY25).
The decrease was attributed to a reduction in flight operations due to financial challenges.
First Published: Sep 23 2024 | 2:58 PM IST
