SpiceJet Stock Falls As Company Launches QIP At 21% Discount To Last Closing
SpiceJet stock fell as much as 6.35% during the day to Rs 72.85 apiece on the BSE.
SpiceJet Ltd. stock fell more than 6% after the airline’s Rs 3,000-crore qualified institutional placement offered shares at a 20.81% discount to the last closing price.
The issue, priced at Rs 61.60 per share, closes on Tuesday and aims to address the financial and operational challenges the low-cost carrier has been facing. The shares are sold at a 4.92% discount to the floor price of Rs 64.79 and well below the last traded price of Rs 77.79 on the BSE.
The capital raise is aimed at addressing liabilities, including Rs 3,700 crore owed to lessors, vendors, and suppliers, along with Rs 650 crore in unpaid statutory dues. SpiceJet's fleet has shrunk from 74 aircraft to 28, with 36 grounded due to funding issues.
The QIP, expected to dilute 38% of post-issue equity, will see shares credited to investors' demat accounts on Sept. 24.
Approved by shareholders on Sept. 13, the QIP is critical to stabilising operations and restoring the fleet. The management highlighted rising fuel costs and payment delays in a recent presentation.
SpieceJet shares were trading 4.26% lower at Rs 74.48 apiece.
SpiceJet stock fell as much as 6.35% during the day to Rs 72.85 apiece on the BSE. It was trading 4.26% lower at Rs 74.48 apiece, compared to an 0.1% advance in the Sensex as of 9:19 a.m.
It has risen 104.50% in the last 12 months and 29.41% on a year-to-date basis. The total traded volume so far in the day stood at 3.9 times its 30-day average. The relative strength index was at 73.84, indicating that the stock is overbought.
One out of the four analysts tracking SpiceJet has a 'buy' rating on the stock, two recommend a 'hold,' and one suggests a 'sell,' according to Bloomberg data. The average of 12-month analyst price targets implies a potential downside of 43.4%.
