SpiceJet To Deposit $5 Million In 2 – Latest news headlines


Madras High Court has ordered winding up of SpiceJet and taking over of its assets over unpaid dues

Madras High Court has ordered winding up of private carrier SpiceJet Limited and directed the official liquidator attached to the High Court to take over its assets, in a plea filed by a Swiss company over unpaid dues.

The airline had failed to make payment of over $24 million to a Swiss company SR Technics for maintenance, repair and overhauling of aircraft engines, modules, components, assemblies and parts.

The order was passed by the high court on December 6, 2021.

However, SpiceJet in a filing to the Bombay Stock Exchange today said, “the Madras High Court through its order dated December 6, 2021 has stayed the earlier order of winding up and appointment of official liquidator for a period of three weeks, subject to the condition that the Company deposits the amount equivalent to $5 million within a period of two weeks.”

The court was allowing a company petition from Credit Suisse AG, a stock corporation registered under the laws of Switzerland, which appealed for winding up of the Indian firm under the provisions of the Companies Act, 1956 and appoint the Official Liquidator of the high court as the Liquidator with all powers under Section 448 of the Companies Act to take charge of SpiceJet’s assets, properties, stock in trade and books of accounts.

The “respondent company (SpiceJet) has miserably failed to satisfy the three pronged test suggested by the Supreme Court in Mathusudan Govardhandas & Co. v. Madhu Woollen Industries (P) Ltd., and hence had rendered itself liable to be wound up for its inability to pay its debts under Section 433 (e) of the Companies Act 1956,” Justice R Subramanian said in his order on Monday and directed the private carrier be wound up and the official liquidator take over its assets.

According to the petitioner, SpiceJet had availed of the services of SR Technics, Switzerland, for maintenance, repair and overhauling of aircraft engines, modules, components, assemblies and parts, which are mandatory for its operations. An agreement for performance of such services for a period of 10 years was entered into between SpiceJet and SR Technics on November 24. 2011.



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Latest News Today – Indian Airlines Risk Consolidation, Plane Repossessions


India’s airlines are under renewed pressure to raise cash or face the risk of having to downsize, consolidate or have their planes repossessed by lessors as a surge of COVID-19 infections roils travel.

Passenger traffic fell nearly 30 per cent in April from a month before and has halved again so far in May, forcing even the country’s biggest and most cashed-up carrier, IndiGo, to gear up for the storm.

IndiGo’s parent, Interglobe Aviation, will meet on Friday to consider an equity raising, just months after it abandoned plans to raise up to Rs 4,000 crore ($543 million) in January due to a speedy recovery in travel.

With traffic plummeting, according to aviation ministry data, IndiGo’s cash burn is expected to rise to $3.4 million a day – a level last seen in September – from $2 million a day at the end of 2020, said an analyst who tracks the company.

This means IndiGo, which has more than a 50 per cent share of the market, may look to raise $543 million to $679 million amounting to at least two quarters of cash burn, said the analyst, who declined to be named as he was not authorised to speak publicly.

While IndiGo is seen as a survivor, the situation is far worse for a suite of smaller carriers, particularly those without large backers, some of which were already struggling before the coronavirus hit, say analysts.

“India hasn’t provided much government assistance or support so the private airlines will need to turn to the private sector,” said independent aviation analyst Brendan Sobie.

The cash call comes as carriers are expected to report total losses of $4-$4.5 billion in the fiscal year that ended on March 31 and will lose a similar amount this year, aviation consultancy CAPA India said in a note this week.

With more people losing loved ones and the outlook on the economy, jobs and incomes turning down, a recovery in domestic travel, which had been expected by the end of 2021, may not come until at least the first quarter of 2022, analysts estimate.

To make matters worse, several countries including the United States and Britain with whom India has had bilateral arrangements to operate charter flights have restricted arrivals due to high infection rates.

The charters offered a lucrative revenue stream for local carriers after the government shut down regular international flights when the pandemic hit. A recovery in international traffic to pre-COVID levels is expected only by 2024, according to CAPA.

Lessors Less Forgiving

Smaller carriers like SpiceJet Ltd and privately owned GoAir could come under pressure to reduce capacity, find partners or consolidate, analysts say, particularly as aircraft lessors take a harder line.

CAPA expects 250-300 planes to be grounded in the first half of the current fiscal year, while lessors may not be as patient as last year in allowing delayed repayments now air travel is resuming in places such as the United States and China.

“There is now more demand for aircraft, and they would rather have the asset back than let airlines use it for free and depreciate it,” said Sanjiv Kapoor, former chief commercial officer of Indian airline Vistara.

Debt forgiveness is also unlikely.

“Lessors are united in not writing off airline debts and that won’t change, as some are also under severe threat of bankruptcy,” said Shukor Yusof, head of aviation consultancy Endau Analytics.

GoAir plans to raise up to Rs 2,500 crore through an initial public offering, local media reported in March, though as the COVID-19 situation worsens the attraction for investors becomes less clear.

While IndiGo, which took delivery of 44 new planes from Airbus last year, has not delayed lease payments, SpiceJet had missed payments even before COVID-19 hit, according to leasing industry sources, and its financial accounts state it has delayed payments during the crisis.

GoAir and SpiceJet did not immediately respond to a request for comment.

Any carriers that have planes repossessed will struggle once the market picks up. While CAPA says consolidation is inevitable, potentially leading to a 2-3 airline system, other analysts say it is still too early to predict an outcome.

“This hopefully will be a temporary setback for all airlines. We will have to see if all the players will be able to weather the storm,” said Sobie.



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SpiceJet’s Net Loss Halves To Rs 57 Crore In December | Sidnaz Blog


SpiceJet operated 329 flights per day and managed a fleet of 19 cargo planes

SpiceJet halved its net loss to Rs 57 crore in the third quarter ended December 31, 2020 from a loss of Rs 112.6 crore in the preceding second quarter due to an increase in operations. The airline’s total income stood at Rs 1,907 crore in the quarter under consideration as against Rs 1,305 crore in the September quarter, the airline said in a regulatory filing to the stock exchanges.

On an EBITDA basis, SpiceJet achieved a profit of Rs 451.4 crore for the third quarter as against Rs 442 crore in the second quarter.

Ajay Singh, Chairman and Managing Director, SpiceJet, said, “With our cargo business proving its true potential, the passenger business getting back on track significantly and a tight control on costs, we have managed to reduce our losses significantly in this quarter. There has been a remarkable recovery from where we were a few months back and with the world’s biggest vaccination drive underway, I see a strong revival across sectors.”

Passenger revenue improved by 73 per cent on a quarter-on-quarter basis through charters, aggressive network and sales strategies.

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The airline operated at 72 per cent of the pre-Covid schedule. It operated 329 flights per day and managed a fleet of 19 cargo planes including five wide-body aircraft

SpiceJet also entered into a partnership with Brussels Airport, Adani Ahmedabad International Airport, GMR Hyderabad Air Cargo for transporting Covid-19 vaccines.

The shares of SpiceJet ended 1.1 per cent higher at Rs 87.85 on the BSE as against a flat closing on the benchmark indices.



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SpiceJet Boeing 737 Makes Hard | Sidnaz Blog

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The landing gear of a SpiceJet aircraft that suffered a hard landing in Guwahati

Highlights

  • There were 155 on board, including two pilots and four cabin crew
  • The aircraft was being flown by the co-pilot at the time of the incident
  • Cut marks have been observed on one of the tyres in the main landing gear

New Delhi:

A SpiceJet Boeing 737-800 jetliner – SG-960 – on a flight between Bengaluru and Guwahati damaged three runway threshold lights as it touched down approximately 1,000 feet short of the normal landing zone on the runway.

There were 155 on board, including two pilots and four cabin crew.

“The flight was uneventful till approach and [the] aircraft was cleared to land on runway 2.  As per the pilot in command, due to low clouds on short finals, he lost perception of altitude causing [a] high descent rate which led to touchdown on threshold, causing a hard landing,” said a source in the aviation regulator Directorate General of Civil Aviation (DGCA).

Newsbeep

The aircraft was being flown by the co-pilot at the time of the incident. Both pilots have been de-rostered pending an investigation by the DGCA.

Cut marks have been observed on one of the tyres in the main landing gear after the aircraft was safely moved to a parking bay and inspected.

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