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Aviation stocks take-off on ATF price cut

Capital Market / 11:58 , Feb 01, 2012

Three aviation shares rose by between 4.25% to 4.73% at 11:41 IST on BSE after state-run oil marketing companies with effect from midnight, 31 January 2012, slashed jet fuel prices by over 3% as an appreciating rupee made imports cheaper.

Kingfisher Airlines (up 4.25%), Jet Airways (India) (up 4.33%) and SpiceJet (up 4.73%) edged higher.

The BSE Sensex was down 57.19 points or 0.33% at 17,136.36

Jet Airways (India) had outperformed the market over the past one month till 31 January 2012, rising 46.84% compared with Sensex's 11.25% return. The scrip had also outperformed the market over the past one quarter, falling 2.73% as against Sensex's 2.89% fall.

SpiceJet had outperformed the market over the past one month till 31 January 2012, rising 25.52% compared with Sensex's 11.25% return. The scrip, however, underperformed the market over the past one quarter, falling 11.13% as against Sensex's 2.89% fall.

Kingfisher Airlines had outperformed the market over the past one month till 31 January 2012, rising 17.34% compared with Sensex's 11.25% return. The scrip had also outperformed the market over the past one quarter, gaining 1.23% as against Sensex's 2.89% fall.

The price of jet fuel in Delhi was cut by Rs 1,974 per kilolitre (kl), or 3.02%, to Rs 62,908 per kl with effect from midnight, 31 January 2012.

Jet fuel, or aviation turbine fuel (ATF) makes up for 50% of an airlines' operating cost and the cut in prices will ease burden on the cash-strapped airlines.

The three public sector oil marketing companies (PSU OMCs) BPCL, HPCL and Indian Oil Corporation revise jet fuel prices on the 1st and 16th of every month, based on the average international price in the preceding fortnight.

 



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