Jet Airways Shares Soar on Possible Deal Closure with Etihad

Aug. 23, 2013
Shares of Jet Airways India Ltd gained 12.8% as airline clears regulatory hurdle holding up Etihad Airways deal

Aug. 23--MUMBAI -- Shares of Jet Airways India Ltd gained as much as 12.8% in Friday trade on rumours that the airline will clear the last regulatory hurdle holding up its deal with Etihad Airways PJSC.

The stock is the biggest gainer in the BSE200 Index and saw its biggest intra-day gain since 26 July.

Jet Airways, the country's second largest airline by passengers carried, wants to sell a 24% stake to Etihad and is waiting for final clearance from the Cabinet Committee on Economic Affairs (CCEA).

On 29 July, the Foreign Investment Promotion Board (FIPB) conditionally allowed the deal.

Mumbai-based Jet Airways is set to become the first beneficiary of a policy change that allowed foreign airlines to invest in domestic ones.

Analysts tracking the airline sector said that airline will clear the hurdle even as the deal has to secure approval from the Competition Commission of India, the country's fair trade regulator.

They added that the rumours about Qatar Airways picking up a stake in budget airine GoAir may have made the Indian aviation sector look good on bourses.

Jet Airways reported a loss in the three months ended 30 June as a slump in the rupee offset gains in what's considered a strong quarter for domestic airlines.

The airline made a loss of Rs.355 crore compared with a net profit of Rs.24.7 crore in the year-ago quarter. Net sales fell 13% to Rs.3,778.78 crore from Rs.4,344.92 crore.

Shares of Jet Airways gained 8.77% to Rs.323 apiece at 10.47am on Friday on BSE, on a day when the exchange's benchmark Sensex gained 0.5% to 18,403.80.

Copyright 2013 - Mint, New Delhi