SpiceJet Soars with Rs 3,000 Crore QIP Success

SpiceJet shares saw a sharp increase of over 8% today, reaching an intraday high of Rs 74.7 per share. The surge came after reports indicated that the airline had received a positive response to its Rs 3,000 crore share sale to qualified institutional buyers.

At 9:18 AM, SpiceJet’s shares were up by 3.44% at Rs 71.48 per share, outperforming the BSE Sensex which was trading 584.12 points higher at 83,532.35 at the same time. The qualified institutional placement was oversubscribed, with participation from various investors, including family offices and institutional funds.

Notable investors in the placement include the family offices of Madhu Kela, Akash Bhansali, Sanjay Dangi, Rohit Kothari, and Bandhan Bank. The airline mentioned in its preliminary placement document that it had financial constraints preventing it from meeting statutory liabilities on a monthly basis.

SpiceJet’s statutory dues amounted to Rs 601.5 crore as of September 15, and the net proceeds from the placement will be used to clear these dues. The funds will also go towards settling liabilities with creditors such as aircraft and engine lessors, engineering vendors, and financiers.

The airline had set a floor price of Rs 64.79 per share for the sale of securities to qualified institutional buyers, aiming to raise up to Rs 3,000 crore. Shareholders had previously approved this proposal.

Over the past year, SpiceJet shares have seen significant growth, with an 81.6% increase compared to the BSE Sensex’s rise of 22.7%. The airline may offer a discount of up to 5% on the floor price in accordance with shareholder approval and SEBI regulations.

In conclusion, SpiceJet’s successful share sale and investor participation signal confidence in the airline’s financial prospects despite the challenges it has faced. The funds raised will help the company meet its statutory obligations and further strengthen its position in the market.