SpiceJet’s two-fold plan for clearing AAI dues
AVIATION & AIRPORTS

SpiceJet’s two-fold plan for clearing AAI dues

SpiceJet has proposed bringing down the principal amount due to the Airports Authority of India (AAI) below 75% of the bank guarantees by the end of March 2021. The airline has also agreed to clear the entire interest debt or increase the bank guarantees by then.

As per AAI's credit policy, it can encash the bank guarantees if the total dues of an airline are above 75% of the bank guarantees.

A reputed media source had reported that the no-frills carrier owed approximately Rs 147 crore as principal amount and Rs 78 crore as interest. AAI has a bank guarantee of (approximately) only Rs 155 crore.

An official told a prominent media source that as a part of its two-fold plan, SpiceJet would bring the principal amount below the 75% threshold and clear the interest amount entirely or provide additional bank guarantees before the end of the fiscal.

This is subject to the approval of the AAI board and the Delhi High Court.

In June 2020, AAI had put SpiceJet on cash-and-carry mode for a daily fee of Rs 1.1 crore. SpiceJet submitted a two-year-long payment plan which AAI did not accept, after which it proposed to encash the bank guarantees.

In December 2020, SpiceJet applied for an additional loan of Rs 500 crore and requested a one-time debt restructuring of its total dues. According to banking sources, a decision based on SpiceJet's rating will be taken before this month-end.

Lenders, auditors, and stakeholders have been concerned about SpiceJet's extremely weak financial health. Between Q2 FY15 and Q2 FY21, the airline operator's total liabilities have jumped by a whopping 223%, as per a review of the airline's financial statement.

In September 2014, SpiceJet's total liabilities were Rs 4,457 crore. Its current and non-current liabilities were Rs 2,982 crore and Rs 1,475 crore, respectively.

Image Source

SpiceJet has proposed bringing down the principal amount due to the Airports Authority of India (AAI) below 75% of the bank guarantees by the end of March 2021. The airline has also agreed to clear the entire interest debt or increase the bank guarantees by then. As per AAI's credit policy, it can encash the bank guarantees if the total dues of an airline are above 75% of the bank guarantees. A reputed media source had reported that the no-frills carrier owed approximately Rs 147 crore as principal amount and Rs 78 crore as interest. AAI has a bank guarantee of (approximately) only Rs 155 crore. An official told a prominent media source that as a part of its two-fold plan, SpiceJet would bring the principal amount below the 75% threshold and clear the interest amount entirely or provide additional bank guarantees before the end of the fiscal. This is subject to the approval of the AAI board and the Delhi High Court. In June 2020, AAI had put SpiceJet on cash-and-carry mode for a daily fee of Rs 1.1 crore. SpiceJet submitted a two-year-long payment plan which AAI did not accept, after which it proposed to encash the bank guarantees. In December 2020, SpiceJet applied for an additional loan of Rs 500 crore and requested a one-time debt restructuring of its total dues. According to banking sources, a decision based on SpiceJet's rating will be taken before this month-end. Lenders, auditors, and stakeholders have been concerned about SpiceJet's extremely weak financial health. Between Q2 FY15 and Q2 FY21, the airline operator's total liabilities have jumped by a whopping 223%, as per a review of the airline's financial statement. In September 2014, SpiceJet's total liabilities were Rs 4,457 crore. Its current and non-current liabilities were Rs 2,982 crore and Rs 1,475 crore, respectively. Image Source

Next Story
Infrastructure Transport

HMRTC to Extend Metro from Gurugram to Jhajjar

The Haryana Mass Rapid Transport Corporation (HMRTC) is progressing with plans to extend the Gurugram Metro from Basai to Bhadsa in Jhajjar, with the ridership survey expected to be completed by the end of January, according to HMRTC officials. In March, the authority had requested Railway India Technical and Engineering Services (RITES) to conduct a ridership survey, which will play a crucial role in finalising the project. The proposed route, covering 23.1 km from Basai to Bhadsa, will alleviate heavy traffic on this stretch. The ridership survey will determine whether the extension should p..

Next Story
Building Material

Siam Cement BigBloc Construction bags Tata Project’s order

SIAM Cement BigBloc Construction Technologies, a joint venture between Gujarat based BigBloc Construction and Thailand’s SCG International Corporation, has secured a work order from Tata Projects for supply and installation of AAC Panels for India’s first Semiconductor unit of Micron India in Sanand, Gujarat. The work order of approx. 2 lakh square feet is for supply and installation of 100 mm AAC panels for Micron India’s semiconductor factory at Sanand. The work order was finalized after several rounds of meetings, thorough due diligence, and factory visits, including review of mock-u..

Next Story
Infrastructure Urban

Zoomlion Releases World's Tallest Straight Boom Aerial Work Platform

Zoomlion Heavy Industry Science & Technology has released a series of groundbreaking aerial work platform (AWP) products, including the world's tallest straight boom aerial work platform, the ZT82J, with a height of 82.3 m. These innovative products further solidify Zoomlion's leadership in the AWP sector and underscore its commitment to global market development. The ZT82J marks Zoomlion's third instance of setting a world record in straight boom AWP following the 68-meter and 72-meter products. The 82.3-meter AWP boasts a platform amplitude of 34.1 meters, a maximum working load of 454 kilog..

Hi There!

"Now get regular updates from CW Magazine on WhatsApp!

Join the CW WhatsApp channel for the latest news, industry events, expert insights, and project updates from the construction and infrastructure industry.

Click the link below to join"

+91 81086 03000