Jet Airways share price: Shares of India's biggest full-service carrier Jet Airways rose nearly 3% after a media report said that the cash-strapped airline is planning to raise up to Rs 2,000 crore against its forward sales.
Jet Airways share price: Shares of India’s biggest full-service carrier Jet Airways rose nearly 3% after a media report said that the cash-strapped airline is planning to raise up to Rs 2,000 crore against its forward sales. Debt-ridden Jet Airways is in talks with homegrown non-banking financial companies (NBFCs) to raise around Rs 1,500-2,000 crore to monetise its forward sales, The Financial Express reported quoting sources. Jet Airways on Friday also informed the stock exchanges that it will announce its financial results for the first quarter ended June on 27 August 2018.
Following the report, shares of Jet Airways rose by 2.8% to Rs 308.90 in early trade on Friday. At the time of reporting, Jet Airways shares were trading higher by 1.51% at Rs 305. On the National Stock Exchange, Jet Airways share price jumped 2.9% t0 Rs 309 per share in early morning trade. The debt-ridden airline company had deferred the announcement of its quarterly results last week saying that the audit committee didn’t recommend Q1 earnings results to the board of the company for approval “pending closure of certain matters”.
With respect to raising funds, the FE report said that bookings worth roughly around Rs 1,600 crore are done through credit cards on Jet’s portal and all the bookings done through credit cards will directly go to the concerned NBFC, instead of accruing to the airline. However, despite efforts, the airline’s top brass have not been able to cut salaries of pilots. The report mentioned quoting Jet’s annual report the airline has already entered into forward sales of Rs 3,686 crore, about 15% of its total revenues.
Last week, Jet Airways — the second largest airline by market share — had also denied reports that it is only left with cash to run for 60 more days. The airline has been facing cash crunch for some time now. On August 13, the Naresh Goyal-promoted airline had said it was evaluating various funding options to meet liquidity requirements on priority, adding that it has never defaulted on its payment obligations with the lenders who have issued certificates to this extent as well on a regular basis.
Jet’s total revenues for FY18 stood at Rs 24,510.69 crore, the report said. Jet Airways shares have slumped over 20% since July 2, following the financial crisis at the airline. The stock has fallen 64% (Thursday’s close at Rs 300.45) from its January 1 closing at Rs 842.75 on the BSE. From its 52-week high of Rs 883.65 on January 5, 2018, the Jet counter tumbled 70% to hit a one-year low of Rs 261.60 on August 10 after the company had deferred the announcement of its quarterly results.