Aviation stocks take off on stable ATF prices, fuller planes

Mumbai: Airline stocks have started taking off on the bourses again in a clear indication that the aviation sector is in a rebound mode.
Airlines like Jet Airways, Kingfisher Airlines and Delhi-based low-cost airline SpiceJet all have performed well in the past few days compared to their all-time low performance in March this year. Sectoral analysts say improving load factors, stable aviation turbine fuel (ATF) costs and better yields are driving the sector in the positive territory.
Jet Airways, which reached an all-time low at Rs 115.25 on March 12, 2009, closed at Rs 534 on Tuesday on the BSE. The stock reached an all-time high of Rs 605.95 on December 3. Kingfisher’s share price is also heading northwards, with its shares closing at Rs 56.50 on Tuesday, compared to an all-time low of Rs 24.40 on March 9 this year. In June this year, its stock peaked at Rs 73.45. SpiceJet also has a reason to cheer as its stock closed at Rs 51.85 on Tuesday. Its share price peaked at Rs 59.40 on December 4 and had dipped to an all-time low at Rs 11.90 in Jan this year. Says Ambareesh Baliga, vice-president at Karvy Stock Broking Ltd, “The aviation sector has become optimistic due to the improvement in load factors of various airlines in the current financial quarter of FY 2009-10. The aviation turbine fuel (ATF) cost has also stabilised at $70-$80 a barrel. Last year, the loads had dipped due to the recession and the sector had to take a hit in its topline.”
According to statistics provided by the Directorate General of Civil Aviation (DGCA), airlines ferried 39.57 lakh passengers in November 2009, compared to 30.48 lakh passengers in the corresponding period a month ago.
23/12/09 Financial Express

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Categories: Indian Aviation- In General Dec 2009