Aviation Stocks Gain After Government Increases Capacity To 65%

Shares of airline operators – InterGlobe Aviation and SpiceJet rose over 3 per cent to hit intraday highs of Rs 1,810 and Rs 81 respectively after the government increased the capacity to 65 per cent from 50 per cent in view of increasing passenger demand for domestic travel, Ministry of Civil Aviation said. 

The airlines have been operating only 50 per cent of their pre-Covid domestic flights since June 1 in accordance with a May 28 order of the ministry. Before June 1, the cap was at 80 per cent. 

The May 28 decision to bring down the cap from 80 to 50 per cent was taken in view of the sudden spike in the number of active COVID-19 cases across the country. 

The government’s order added that the 65 per cent cap will be applicable till July 31, 2021 or until further orders, whichever is earlier. 

So far this year, IndiGo shares have advanced 3 per cent and SpiceJet has declined 15 per cent. 

As of 2:30 pm, SpiceJet shares were trading 0.2 per cent higher at Rs 79.25 and IndiGo was up 0.63 per cent at Rs 1,768.