Airline Penny Stock Under Rs 50 Signs USD 121 Million Restructuring Deal with Carlyle Aviation to Settle Lease Obligations
The stock is up by 9.08 per cent from its 52-week low of Rs 39.91 per share.
SpiceJet Limited, one of India’s prominent low-cost carriers, has announced a major financial restructuring deal with Carlyle Aviation Management Limited (CAML) aimed at resolving outstanding aircraft lease dues. As of March 31, 2025, the airline’s lease liabilities stood at USD 121.18 million. The new agreement is a strategic step toward reducing debt and stabilising the airline's financial position.
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Under the terms of the settlement, SpiceJet plans to issue equity shares to lessors managed by CAML at Rs 65 per share or as per SEBI’s preferential issue guidelines. The issuance, amounting to a total of up to USD 50 million, is subject to shareholder approval and regulatory compliance. Importantly, the equity stake held by CAML after the share issuance will not exceed 10 per cent of SpiceJet’s total share capital, ensuring adherence to regulatory and corporate governance standards.
The restructuring is expected to significantly de-leverage the company’s balance sheet. Additionally, the agreement includes a comprehensive review of existing lease arrangements, covering potential extensions, adjustments in maintenance reserves, engine overhaul schedules, the reactivation of grounded aircraft, redelivery terms, and credit lines. These changes aim to bring operational stability and efficiency to SpiceJet’s fleet management.
Crucially, the settlement terms stipulate that the transaction does not directly benefit the promoter or promoter group. However, once the statutory lock-in period ends, lessors will be required to notify the promoter or their assignee before selling or transferring any equity shares. This provides the promoter with a right of first refusal on mutually agreed terms.
About the Company
SpiceJet is India's favourite airline that has made flying affordable for more Indians than ever before. SpiceJet is an IATA-IOSA certified airline that operates a fleet of Boeing 737s & Q-400s and is one of the country's largest regional players operating multiple daily flights under UDAN or the Regional Connectivity Scheme. The majority of the airline's fleet offers SpiceMax, the most spacious economy-class seating in India.
Despite a 35 per cent year-over-year (YoY) drop in sales to Rs 1,237.0 crore, compared to Rs 1,914.4 crore in Q3 FY23e, the company demonstrated a significant financial recovery; EBITDA losses narrowed by 21 per cent YoY to Rs -188 crore, and net profit turned positive at Rs 25 crore, a 108 per cent YoY improvement. This positive shift, alongside a 104 per cent increase in EPS to Rs 0.19, was largely attributed to a 72.3 per cent surge in other income to Rs 417.1 crore, which compensated for the operational revenue decline.
The promoters of the company bought 9,96,14,052 shares and increased their stake to 33.47 per cent in March 2025 compared to December 2024. Additionally, Authum Investment & Infrastructure Limited holds a 2.65 per cent stake and Plutus Wealth Management LLP holds a 2.71 per cent stake in the company as of March 2025. In its annual results, the company reported net sales of Rs 7,085 crore, an operating loss of Rs 644 and a net loss of Rs 424 crore in FY24. The company has a market cap of over Rs 5,500 crore.
Disclaimer: The article is for informational purposes only and not investment advice.