IndiGo, Spicejet Shares Go Bullish, As GoFirst Goes Cash Strapped
The GoFirst crisis showed its impact on the Indian share market too on Wednesday, as shares of rival airline Indigo and Spicejet went bullish. While Indigo’s parent company Interglobe Aviation jumped by 100.70 points on Nifty, Spicejet shares jumped by 0.76 on the Sensex.
By 2 pm, Interglobe was already trading at Rs 2,168.05 after a gain of 4.89 per cent on the NSE, shares of SpiceJet surged about 6 per cent to Rs 33.25 against its close at Rs 31.49 in the previous session. The now defunct Jet Airways too saw a gain in its stock prices, trading at Rs 60.90 after a jump of 5 per cent.
It may be recalled that cash-strapped airline Go First filed for bankruptcy on Tuesday, blaming “faulty” Pratt & Whitney engines for the grounding of about half its fleet and taking lenders by surprise.
The Wadia Group, which also owns the textile company Bombay Dyeing and Manufacturing Co, is the owner of the airline and Bombay Dyeing’s shares also fell by 4.14 per cent. Another Wadia owned company Bombay Burmah Trading, that provided loans to Go First in the form of inter-corporate deposits, had a decline of 7.35 per cent.
However, Wadia group’s FMCG company Britannia saved the day for them as its shares continued to rise and was trading at Rs 4,522.50 after a marginal rise of 0.27 per cent.
According to market experts, the airline stocks went higher especially for Indigo as it happens to be one of the biggest domestic airlines in India. Together with the Tata Group, Indigo captures nearly 80 per cent of the aviation market in India in the domestic sector. With GoFirst filing for insolvency, about 9 per cent of the market share will once again become an open ground for all other rivals.
