The News International Team
02:55pm SpiceJet falls: Low-cost carrier SpiceJet will have to cancel more than a fifth of its planned daily flights if it cannot reach an agreement with its lessors to bring in more aircraft by the end of this month, a company spokesman said.
SpiceJet, which came close to collapsing in December after running out of cash to pay its creditors, is scheduled to make 280 daily flights from next week.
But with its current fleet at 17 Boeing 737 jets and 15 Bombardier Q400s SpiceJet can only fly 218 journeys a day, the spokesman said on Friday.
SpiceJet lost 11 of its Boeing planes after the Delhi High Court this month ordered the aviation regulator to deregister the jets, following disputes with three lessors.
The troubles of India’s second-largest budget carrier by market share have underlined the difficulties of operating in the country, where air travel is growing rapidly but high costs and tough competition have left most carriers unprofitable.
The company spokesman said SpiceJet is in talks to resolve disputes with two of its lessors and get back enough planes to allow it to meet its summer schedule. On Monday it said one of its lessors had agreed to withdraw the deregistion process, reports Reuters.
02:30pm Interview: Talking on the business prospects going forward Vimal Kejriwal, MD & CEO, KEC International said January to March quarter has always been the best. Historically, about 40-45 percent of the company’s revenues come from the fourth quarter.
The company has already announced orders worth Rs 2000 crore in Q3 and Q4 and the total order book by March-end would be between Rs 8000-10000 crores. So, the revenues and margins in Q4 and the next fiscal would improve considerably, he adds.
He expects 150-200 basis points improvement in margins for the next fiscal. In the current year the margins were low due to significant losses in the new business of water and railway but now these loss making orders are getting closed, adds Kejriwal.
According to Kejriwal, the order inflow in first three quarters was not significant even though tenders were floated but now clients like Power Grid and utilities are keen to award those tenders.
02:00pm Market Check
The market recouped its losses to trade flat amid consolidation in afternoon. The Sensex declined 5.63 points to 27451.95 and the Nifty slipped 12.60 points to 8329.55.
The broader markets too cut its half of the losses, down around 0.4 percent. The market breadth remained negative with advance:decline ratio of 902:1830 on the Bombay Stock Exchange.
Valuations for Indian market have gotten out of hand and the next 12 months could be “very painful” for some parts of it, believes Dimensions Consulting’s Ajay Srivastava.
Srivastava said that economy looked “fundamentally positive” in the wake of reforms undertaken by the government, but the steps will take time to percolate down to earnings.
India’s biggest lenders State Bank of India and ICICI Bank climbed over 2 percent followed by HDFC Bank with 0.6 percent whereas housing finance company HDFC remained under pressure, down 1 percent.
Infosys rose 2.6 percent after unlisted rival Accenture raised its revenue growth guidance for the current calendar year 2015 to 8-10 percent Y-o-Y in local currency (against its previous 5-8 percent Y-o-Y guidance).
Shares of Larsen and Toubro (L&T) gained 1.65 percent following order worth Rs 1,711 crore win by subsidiary and plans to list businesses over next three years.