Shares of low-cost carrier SpiceJet Ltd surged as much as 14.2 per cent to highest since July 30. Domestic airlines' passenger traffic rose 5.62 per cent in February from January, data the Directorate General of Civil Aviation showed.
The shares of SpiceJet closed higher by 7.04 per cent at Rs 98.10.
Passenger load factor for SpiceJet rose to 94 per cent in February from 90.9 per cent in January, while InterGlobe Aviation Ltd-owned IndiGo's load factor rose 88.4 per cent vs 86.4 per cent in January. Load factor for cash-strapped Jet Airways Ltd rose to 89.4 per cent from 86.1 per cent.
A combination of supply disruption across key airline operators and increasing fares (anecdotal) resulted in one of the weakest air traffic growth prints over the past few years, Citi analysts say in a note. Passenger traffic growth slowest in five years due to increased fares.
In recent months, industry capacity growth has slowed down significantly, driven by temporary problems with Pratt & Whitney, shortage of pilots, grounding of Boeing 737 Max and liquidity problem at Jet Airways - HSBC Global Research. “This has raised spot fares significantly which has dented demand,” says HSBC.
IndiGo shares up 0.65 per cent and the stock of Jet Airways up 1.9 per cent.
IndiGo ended at Rs 1,426.85, higher by 0.28 per cent and the Jet Airways closed higher by 3.60 per cent at Rs 225.85.