Jet Airways Declines After Record Quarterly Loss: Mumbai Mover
Jet Airways (India) Ltd. (JETIN), the nation’s biggest publicly traded carrier, declined the most in almost two months in Mumbai trading after reporting a record quarterly loss as demand declined and fuel costs increased.
Jet fell as much as 6.4 percent, headed for the most since Aug. 28. The shares traded at 333.95 rupees, or down 3.6 percent, as of 11:26 a.m. in Mumbai. The carrier yesterday reported a wider-than-estimated loss of 8.91 billion rupees ($145 million).
“The weakening rupee raised costs significantly during this lean season,” said Rashesh Shah, an analyst at ICICIdirect.com. “At the same time, the company gave out discounts to lure consumers and because of this the yields have taken a big hit.”
The rupee declined more than 15 percent against the U.S. dollar in the 12 months ended Sept. 30. Jet filled 78.2 percent of its seats, according to a presentation on its website.
The carrier’s loss widened from 997 million rupees in the second quarter last year. The loss in the three months ended Sept. 30 was expected at 4.65 billion rupees, according to four analyst estimates compiled by Bloomberg.
The year-end holiday season is typically the busiest period of the year for airlines, and Jet’s performance will probably improve as the rupee has strengthened, Shah said.
India’s cabinet on Oct. 3 cleared a proposal by Abu Dhabi-based Etihad Airways to buy a 24 percent stake in Jet, paving the way for the first share sale by a carrier in the Asian country to a foreign airline since restrictions were eased. Jet is seeking funds to add aircraft and pare debt after six years of losses caused by fuel costs and competition from discount carriers.
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