Airline stocks received a major boost on Wednesday morning, with shares of Jet Airways, Spicejet and IndiGo soaring on the back of falling global crude oil prices.
Airline stocks received a major boost on Wednesday morning, with shares of Jet Airways, Spicejet and IndiGo soaring on the back of falling global crude oil prices. Jet Airways share price jumped as much as 5.28% to hit the day’s high at Rs 224, while Spicejet share price rallied to Rs 74 in the morning trade, gaining by more than 5.3% intra-day. Shares of Interglobe Aviation which runs the IndiGo airline jumped to intraday high of Rs 847. The gain in the stock price of these aviation stocks comes of the back of falling Brent crude price.
Brent crude prices fell 4.37%, clocking their biggest single day’s fall in three months to USD 76.24 barrel Tuesday. The benchmark oil was trading at USD 76.79 barrel in early trade Wednesday, according to a PTI report. The fall in brent crude prices have taken the oil prices to a near-two month low.
Falling brent crude also had a rub off effect on domestic currency rupee, as INR recovered by 42 paise to 73.15 per dollar. The rupee recover against the US currency in early trade this morning, on fresh dollar selling by exporters amid easing crude oil prices and higher opening in the domestic equity markets.The rupee sentiment also received a boost after a steep fall over 4 per cent in Brent crude prices Tuesday, dealers told PTI. IndiGo has retained the highest market share in September at 43.2%; while Jet Airways’ September market share stands at 15.8%. SpiceJet’s share in September stood at 12%, even as national carrier Air India has a 11.8% market share.
Interglobe Avaition is scheduled to report Q2 results later today. Higher crude oil prices and a weakening currency are likely to weigh on the airline’s prospects. Kotak Institutional Equities anticipates net loss to be Rs 466.3 crore against a profit of Rs 551.5-crore profit same quarter last year. Ambit Capital, meanwhile, expects it to widen to Rs 651.8 crore.