SpiceJet May Break Even as Fuel Prices Ease

SpiceJet Ltd., India's second-biggest budget carrier, may post a profit next year as it raises fares and jet-fuel prices fall.
Increases in ticket prices and lower costs will also help SpiceJet narrow losses this year, Ajay Singh, a company director, said yesterday in an interview in New Delhi, where the airline is based.
Indian Oil Corp., the nation's largest refiner, yesterday cut the price of jet fuel by 16 percent, the biggest decrease this year, reducing the carrier's largest expense. SpiceJet, which last month won as much as $100 million in investment from U.S. billionaire Wilbur Ross and Goldman, Sachs & Co., has raised fares by about 45 percent in the past six months to offset higher fuel costs.
``It is difficult to say whether this 16 percent drop in fuel prices is sufficient,'' said Ashutosh Goel, a Mumbai-based analyst at Edelweiss Capital Ltd. ``One needs to see where crude oil prices are going and what is the kind of slowdown in demand because of the higher fares.''
02/09/08 Vipin V. Nair/Bloomberg

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Categories: SpiceJet Sep 2008