(Adds details, background)
BENGALURU, Feb 21 (Reuters) - Indian carrier Spicejet
Ltd said, on Tuesday, it will consider options to
raise fresh capital by issuing securities to qualified
institutional buyers amid a string of quarterly losses as
competition heats up in the aviation industry.
The plan to raise capital comes as Spicejet's cash reserves
dwindle and new entrant Akasa Air jostles for a share of the
market while rival Air India ramps up its revamp plans with
mammoth orders for new aircraft.
Spicejet's market share slipped to 7.3% in January from 7.7%
in December, while IndiGo retained the lion's share of
56.3%. Akasa grabbed 2.8%, while Air India's share was steady at
9.2%, data from the country's aviation regulator showed.
Spicejet's passenger load factor, which measures the
percentage of available seating capacity that has been filled
with passengers, outdid rivals at 91% in January.
Last week, Spicejet postponed its board meeting to approve
financial results for the December quarter to Feb. 24.
At the board meeting on Friday, Spicejet will also consider
issuing shares on a preferential basis after converting
outstanding liabilities into equity shares. The airline's total
equity and liabilities stood at 88.11 billion Indian rupees
($1.06 billion) as at Sept. 30, while cash and cash equivalents
were 66.08 million rupees.
Its losses widened in the September quarter, hit by soaring
fuel costs and a depreciating rupee. The company had last turned
a profit in the three months that ended in December 2021, when
the industry was roiled by pandemic-led curbs.
Meanwhile, the biggest competitor IndiGo returned to profit
in the latest quarter that ended in December led by increased
demand for domestic and international air travel that outpaced
the high fuel costs and currency volatility.
Spicejet shares have recovered sharply from multi-year lows
hit earlier this month and are down around 3% thus far in the
year, compared with a 7% drop in IndiGo owner InterGlobe
Aviation .
($1 = 82.7630 Indian rupees)
(Reporting by Priya Sagar in Bengaluru; Editing by Savio
D'Souza)
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