• SpiceJet management is confident that its business plans and cash flow projections will allow it to be operationally profitable and raise the funds required to meet its liabilities.
New Delhi: SpiceJet Ltd is looking at various options to raise funds, including opting for Emergency Credit Line Guarantee Scheme (ECLGS) and issuing securities to qualified institutional buyers, as the budget airline can survive amid mounting losses. Is.
Since July, it has raised ₹210 crore through ECLGS and is planning to raise more funds through the same channel. The Department of Financial Services had in October amended guidelines for ECLGS to help India's aviation sector tide over cash flow problems, allowing airlines to borrow 100% of the outstanding loan, or a maximum of ₹1,500 crore. Went.
In Q2, SpiceJet raised ₹60 crore through ECLGS and ₹150 crore in October. "The company is in discussions with banks to raise additional funds under ECLGS 3.0, as per the circular dated October 6, and discussions are in advanced stages," the airline said in its earnings statement.
The Board has approved raising of fresh capital through issue of securities to eligible institutional buyers as per law. The airline is also in talks with various investors to renegotiate the payment terms.
SpiceJet management is also confident that its business plans and cash flow projections will allow it to be operationally profitable and raise the funds required to meet its liabilities.
SpiceJet reported a net loss of ₹833.2 crore in the September quarter, up from ₹570.5 crore a year ago. Its net loss in the June quarter stood at ₹789 crore.
“Higher ATF prices and depreciation continue to weigh on the industry, but the overall outlook for the sector remains positive. Ajay Singh, Chairman and Managing Director, SpiceJet said, “After completing a series of settlements with most of our key partners and the upcoming hive of our cargo and logistics arm, we expect significant improvement in our operating environment.
Freight and logistics services were the only profit making segments for the company with a profit of ₹21.3 crore in the September quarter. The segment reported a net profit of ₹18.4 crore in the June quarter and a loss of ₹66.1 crore in the September quarter a year ago.
The company's main air transport services suffered a loss of ₹849.2 crore in July-September. The loss in this segment stood at ₹495.6 crore in the same quarter a year ago. The airline said it plans to demerge its cargo business by December.
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