Elara Capital slashed the target price of this aviation stock by 37% to Rs 39 from Rs 62. The cut in the price target is on the back of a delay in fleet growth and a subsequent earnings downgrade. However, the brokerage house has maintained its ‘Accumulate’ rating as of now.

Elara Capital’s three big concerns

The stock we are talking about is SpiceJet, down 33% in the last one month, and as per the Elara target, there is room for further downturn. Here is a quick look at the big worries at the moment – 

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Elara on SiceJet: Boeing’s delivery globally

SpiceJet targets a fleet size of 52 from 20 at present, as per the company’s June 2025 presentation. The brokerage expects that this is subject to stable operations by Boeing globally. The average monthly delivery of commercial aircraft by Boeing globally has been strong at 42 year to date (January-July 2025) compared to 26 in CY24 and 39 in CY25.

Elara on SiceJet: Aviation peers focusing on fleet renewal

There is a high probability that the domestic airfares may rise YoY in the second half of FY26 due to recent reforms by the government to spur overall demand. Aided by nil fleet growth by InterGlobe Aviation and Tata Group airlines during the first half of CY25 due to their focus on fleet renewal.

Elara on SiceJet: Cuts EPS estimate for FY26

The brokerage estimates EPS at Rs 0.4 for FY27 and Rs 1.4 for FY28, respectively. However, the brokerage cut FY26 EPS estimates to a loss of Rs 8.1 from a profit of Rs 10.2 previously due to lower-than-expected fleet size and weaker Q1 FY26 financials.

Although Elara Capital retained its Accumulate rating on SpiceJet, due to a stable airfare environment and a likely decline in costs, the brokerage is awaiting a significant uptick in fleet size for further growth. 

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SpiceJet stock performance

The share price of SpiceJet has fallen 10% in the last five trading sessions.  The stock has declined by 33% in the last one month. SpiceJet has erased almost 50% investor wealth in the last one year.

SpiceJet has underperformed the NSE Small-Cap index, down 3%, in the last three months, due to operational losses in Q1 and a delay in fleet addition (engine and aircraft availability issues).