Shares of Jet Airways and SpiceJet today dropped by around 5 per cent after jet fuel prices were hiked by a steep 7.6 per cent.
The SpiceJet counter settled 4.74 per cent lower at Rs 30.15, while scrips of Jet Airways plunged 4.47 per cent to close at Rs 338.40 on the BSE.
Shares of Kingfisher Airlines, however, ended the day up 2.81 per cent at Rs 9.16 apiece.
The price of aviation turbine fuel (ATF), or jet fuel, in Delhi was hiked by Rs 5,146.16 per kilolitre (kl), or 7.6 per cent, to Rs 72,281.92 per kl.
This biggest-ever increase in price in absolute numbers comes on back of firming international oil rates and dip in rupee value against the US dollar.
Jet fuel constitutes over 40 per cent of an airline’s operating costs and the increase in prices will put fresh burden on the cash-strapped airlines, said market experts.
The three fuel retailers — IOC, Hindustan Petroleum and Bharat Petroleum — revise jet fuel prices on the 1st and 16th of every month, based on the average international price in the preceding fortnight.