Monday, July 02, 2018

Jet Airways, SpiceJet and IndiGo tank up to 3% even as ATF price cut by 2.7% in Delhi

Jet Airways, SpiceJet and IndiGo share prices slipped up to 3 per cent on Monday even as Aviation turbine fuel (ATF) price was cut by 2.7 per cent on Sunday. ATF contributes significantly to raw material cost of the aviation companies.

IndiGo shares ended at Rs 1049.25, down 3.5 per cent. Jet Airways lost 1 per cent to Rs 342.85, while SpiceJet dipped 1.3 per cent to Rs 107.65 on the BSE. The losses came as the global benchmark Brent crude oil surpassed $78 per barrel, with upward pressure more active on the oil prices.

Rising oil prices hit the margins of airline companies as Air turbine fuel (ATF) constitutes about 40 per cent of an airline's operating cost.

Meanwhile, the reduction in ATF prices came on back of two successive monthly hikes, the last being a steep 7 per cent on June 1 that took rates to four-year high of Rs 70,028 per kl in Delhi. ATF price was on May 1 was raised by Rs 3,890 per kl (6.3 per cent) to Rs 61,450 per kl.

The recent fall in international rates brought down ATF rates from a four-year high. ATF or jet fuel was cut by Rs 1,942 per kilolitre, or 2.7 per cent, to Rs 68,086 per kl in Delhi, according to state-owned oil firms. Prices, however, are back on the rising spree.
02/07/18 ZeeBiz