Aviation stocks fly high after DGCA raises fares on domestic flights

Our Bureau Updated - December 06, 2021 at 07:34 AM.

Earlier, the DGCA has raised the minimum and maximum fares that domestic airlines can charge in the seven categories into which domestic routes are divided.

(FILES) In this photograph taken on July 13, 2011, aircraft from Indigo (C), Air India (L) and Spicejet (R) jostle for space on a runway at Indira Gandhi International Airport in New Delhi. A major acquisition by budget Indian airline SpiceJet underscored the vast potential of the world's fastest-growing passenger aviation market, but experts say woefully inadequate infrastructure and high operating costs could threaten the industry's rapid expansion, January 14, 2016. / AFP PHOTO / RAVEENDRAN / RESTRICTED TO EDITORIAL USE - NO ARCHIVES

The stocks of SpiceJet and InterGlobe Aviation gained on Friday in early trade after the Directorate General of Civil Aviation (DGCA) raised the minimum and maximum fares by 10-30 per cent on domestic flights effective immediately.

At 10 am, Spicejet was up 4 per cent. It was trading at ₹91.50 on the BSE, up ₹3.80 or 4.33 per cent. It opened at ₹93.20 as against the previous close of ₹87.70. It hit an intraday high of ₹94.00 and an intraday low of ₹91.05.

Domestic flying to cost more

On the NSE, it was trading at ₹91.55, up ₹3.80 or 4.33 per cent.

InterGlobe Aviation (IndiGo airlines) recorded marginal gains. It was trading at ₹1659 on the BSE, up ₹31.90 or 1.96 per cent. The stock hit an intra-day high of ₹1,704 as against the previous close of ₹1627.10. It hit an intraday low of ₹1655.00.

On the NSE, it was trading at ₹1,659, up ₹28.65 or 1.76 per cent.

The DGCA on Thursday raised the minimum and maximum fares that domestic airlines can charge in the seven categories into which domestic routes are divided.

The increase is in the range of 10 per cent for a one-way fare at the minimum fare level for a flight of less than 40 minutes to about 30 per cent for a maximum fare for a flight of between 180-210 minutes.

The decision was owing to an uptick in the number of passengers and to help IndiGo and SpiceJet, the two listed airlines that recorded losses in the quarter ended December 2020.

Published on February 12, 2021 05:12