SpiceJet shares experienced a significant surge, climbing over 8% and reaching an intraday high of ₹74.7 per share. This sharp rise came after reports indicated strong demand for the airline's ₹3,000 crore sale of shares through a qualified institutional placement (QIP). At around 9:18 AM, the stock was up by 3.44%, trading at ₹71.48 per share, while the BSE Sensex also saw a boost, gaining 584.12 points and reaching ₹83,532.35.
The QIP received an overwhelming response from several institutional investors and family offices, which has further strengthened the airline's position in the share market investment landscape. Some of the prominent investors include the family offices of Madhu Kela, Akash Bhansali, Sanjay Dangi, Rohit Kothari, and Bandhan Bank.
The oversubscription of the ₹3,000 crore QIP highlights the growing interest in SpiceJet, making it a compelling option for those looking to invest in stocks. The raised funds are expected to support the airline in meeting its financial obligations, including statutory dues and creditor payments.
In the preliminary placement document submitted for the QIP, SpiceJet outlined its current financial challenges. As of September 15, 2024, the airline's statutory dues stood at ₹601.5 crore. These dues include ₹297.5 crore for Tax Deducted at Source (TDS), ₹156.4 crore for employees' provident fund, and ₹145.1 crore related to Goods and Services Tax (GST).
The airline plans to use part of the proceeds from the QIP to clear these liabilities and settle outstanding payments to creditors, including aircraft and engine lessors, engineering vendors, and financiers. This move could provide confidence to those looking to invest in stocks of companies aiming for financial recovery.
The QIP was set with a floor price of ₹64.79 per share, offering a strategic opportunity for investors to buy shares online at a potentially attractive valuation. SpiceJet's shareholders approved the proposal to raise to ₹3,000 crore last week. Additionally, the airline has stated that it may offer up to a 5% discount on the floor price, as per SEBI regulations and shareholder approval.
For those looking to invest in stocks, SpiceJet's recovery over the past year is noteworthy. The airline's shares have gained 81.6% in comparison to the BSE Sensex's 22.7% rise over the same period. Despite its financial struggles, SpiceJet's ability to attract significant investor interest through the QIP demonstrates the confidence that stakeholders have in the company's long-term growth potential.
The raised capital from the oversubscribed QIP will not only address statutory liabilities but also provide SpiceJet with the financial stability it needs to continue its operations smoothly. By settling dues with various creditors, including large lenders like Life Insurance Corporation of India and engineering vendors, SpiceJet aims to strengthen its balance sheet, making it a more attractive choice for those looking to invest in stocks within the airline sector.
Moreover, SpiceJet's ability to attract prominent investors further reinforces its appeal in the share market investment domain. Family offices and institutional funds participating in the QIP have expressed confidence in the airline's long-term prospects, making this a crucial turning point for the carrier.
SpiceJet's ₹3,000 crore QIP oversubscription signals renewed investor confidence in the airline, reflecting its potential for recovery and growth. For those seeking opportunities to invest in stocks, this development places SpiceJet in a favourable position, especially with its plans to settle financial obligations and regain stability. As the airline continues to recover from its financial hurdles, it remains an attractive option for investors looking to buy shares online and benefit from its upward trajectory.
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