Massive equity change in SpiceJet triggers sharp 10% stock price decline

Mumbai: Shares of SpiceJet crashed 10 per cent on Wednesday, hitting the lower circuit on the BSE after massive block deals triggered heavy selling in the airline’s stock. Nearly 8.4 per cent of SpiceJet’s equity changed hands during the session, according to media reports.

Record trading volumes and sharp decline

Around 128.6 million shares were traded through 17 block deals, making SpiceJet one of the most active counters of the day. Trading volumes were more than 16 times the three-month full-day average, reflecting intense selling pressure.

By 11 a.m., the stock was locked at Rs 12.88 per share — its lowest level in over 11 years. The fall marked the seventh consecutive session of decline for SpiceJet shares. Over the past week alone, the stock has dropped approximately 25 per cent, making it the worst performer on the BSE SmallCap index during Wednesday’s trading.

Technical indicators point to extreme weakness, with the 14-day Relative Strength Index (RSI) plummeting to 9.01.

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Expansion plans overshadowed by operational challenges

The sharp sell-off comes despite SpiceJet outlining plans to expand operations. Last week, the airline announced its intent to grow its fleet to around 60 aircraft through a combination of wet and damp leases while bringing grounded aircraft back into service.

SpiceJet’s domestic market share rose to 4.3 per cent in December from 1.9 per cent in September, supported by a 56 per cent increase in capacity during the December quarter. The airline has also set an ambitious target to more than double capacity to 220 crore Available Seat Kilometres (ASK) by Winter 2026.

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Operational headwinds weigh on stock

Despite growth initiatives, operational issues continue to strain the airline. Reports indicate that Bangladesh has barred SpiceJet from using its airspace due to pending dues, forcing some flights from Kolkata — including services to Guwahati — to operate on longer routes, increasing operational costs and inefficiencies.

Analysts say these challenges, combined with aggressive block deals, have contributed to the steep decline in SpiceJet shares, raising concerns among investors about the airline’s short-term financial stability.

IANS