Tuesday, August 07, 2018

Jet Airways: Macro headwinds & legacy issues have led Naresh Goyal-led airline into turbulence

Over a nightcap at the InterContinental Hotel overlooking the alpine slopes of Europe earlier in the year, Naresh Goyal was dispensing avuncular counsel to a fellow NRI billionaire. Garrulous as ever, his demeanour gave away no signs of stress in the airline he had founded a quarter of a century back.
Even a few weeks back, investors couldn’t have possibly second guessed the massive turbulence that Jet AirwaysNSE -0.86 % was flying into yet again. This May, Jet celebrated its 25th anniversary with much cheer. Company statements attributed words of supreme confidence to its chairman Goyal.
“The outlook remains bright,” he said in the latest Jet annual report. On another occassion, he indicated that an investment in ailing national carrier Air India, potentially running into several thousand crores, wasn’t off the airline’s radar.
Barely a quarter later, the headlines hit them last week — India’s second biggest airline by market share had cash just enough to survive for 60 more days. That was enough reason to put the stock into a tailspin to crash nearly to its a 52-week low.
07/08/18 Anirban Chowdhury/Mihir Mishra/Economic Times