On March 12, SpiceJet witnessed a sharp decline of 9.7% in its share price to Rs 54.6 per share following reports of the resignation of Chief Operating Officer (COO) Arun Kashyap and Chief Commercial Officer (CCO) Shilpa Bhatia.
In response to these developments, SpiceJet’s management stated that the resignations are part of the company’s strategic restructuring. Despite this setback, the management remains optimistic about SpiceJet’s growth trajectory, citing significant revenue growth and load factor.
Furthermore, with recent fund raises, SpiceJet aims to expedite the resolution of past disputes and is poised to enhance capacity, accelerate growth, and maintain a prominent position in the Indian aviation sector.
Over the past month, SpiceJet’s stock has witnessed a 13% decline, contrasting with a 3% rise in the benchmark Sensex. Notably, SpiceJet shares had reached a 52-week high of Rs 77 per share on February 5, 2024.
In a previous exchange filing dated March 11, the company disclosed its approval and issuance of 34.66 lakh shares at a face value of Rs 10 each, priced at Rs 50 per share, to Elara India Opportunities Fund. This transaction amounted to a total of Rs 17.33 crore.
Furthermore, on January 25, 2024, SpiceJet had initiated the allocation of equity shares and warrants to raise Rs 744 crore. As part of this allocation, Elara India Opportunities received 8.33 crore warrants priced at Rs 50 per warrant. However, only 4.16% of these warrants have been converted into shares thus far. Additionally, SpiceJet allocated 1 crore warrants at the same price to Silver Stallion.
SpiceJet recently announced the successful completion of an additional fund raise of Rs 316 crore, further bolstering its financial position. This fresh injection of capital brings the total funds raised by the airline to Rs 1,060 crore through a preferential share issue.
The decision to raise additional funds comes in tandem with SpiceJet’s recent announcement of workforce reduction by 10-15%. In January, SpiceJet had already received Rs 744 crore as the first tranche of funds through the allotment of securities on a preferential basis.
Ajay Singh, Chairman and Managing Director at SpiceJet, expressed confidence in the airline’s growth prospects, stating, “The company has raised a total investment of Rs 1,060 crore. This significant capital infusion reaffirms investor confidence in SpiceJet’s growth prospects and strengthens our financial position for the future.
Disclaimer: The opinions and investment insights provided are intended solely for informational purposes and should not be construed as financial advice. Bystox.in strongly advises users to consult certified financial experts or professionals before making any investment decisions. We emphasize the importance of conducting thorough research and seeking personalized guidance tailored to individual financial goals and circumstances. Please be aware that investing involves inherent risks, and past performance is not indicative of future results. Bystox.in does not assume any responsibility or liability for the accuracy, completeness, or reliability of the information provided. Users are encouraged to exercise caution and diligence in their investment endeavors. Remember, your financial well-being is paramount, and seeking expert advice is highly recommended.