SpiceJet surges upto 9% as government allots additional Rs1,000 crore under ECLGS

6 Oct 2022 , 11:43 AM

SpiceJet Limited’s counter gained as much as 9% in Thursday’s trade after a media report stated that the company is expected to receive an additional Rs1,000 crore ($122.70 million) loan under the modified Emergency Credit Line Guarantee Scheme (ECLGS) of the government.

According to airline executives, the capital would be used to make lease payments for new Boeing 737 Max aircraft as well as to settle outstanding statutory dues such as the employee provident fund. “This will end the airline’s survival dilemma once and for all,” remarked one airline executive.

Civil aviation secretary Rajiv Bansal wrote to the finance ministry earlier this month, requesting that under the program, airlines be permitted to borrow up to 100% of their outstanding credit, subject to an Rs1,500 crore maximum.

At around 11.39 AM, SpiceJet was trading 5.98% higher at Rs40.75, against the previous close of Rs38.45 on NSE. So far, it hit an intraday high and low of Rs41.95 and Rs40.15 respectively.

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