SpiceJet's shares jumped on September 27 after the company said that it has settled all GST dues of around Rs 71 crore, only days after financing Rs 3,000 crore through a Qualified Institutional Placement (QIP). "SpiceJet has cleared all its Goods and Services Tax (GST) dues, demonstrating its commitment to maintaining financial discipline and regulatory compliance," according to a statement from the airline.
On September 26, the airline said that it has resolved unpaid wage dues of Rs 80 crore (from June to August). SpiceJet's stock was trading 1 percent higher on the BSE at Rs 62.42 a share at 11 a.m. on September 27.
"We are proud to have cleared all GST dues, a significant step towards reinforcing our commitment to financial discipline and regulatory compliance. "These developments reflect our commitment to providing exceptional service to our passengers while positioning ourselves strategically for the future," stated Ajay Singh, Chairman and Managing Director at SpiceJet.
On September 24, SpiceJet reported that it has reached an amicable resolution with Engine Lease Finance Corporation (ELFC). ELFC had earlier claimed $16.7 million, and a settlement was made for an undisclosed amount that is less than the original claim. This settlement is another crucial step in improving SpiceJet's financial stability.
The QIP, which began on September 16 and ended on September 18, had an enormous response from eligible investors and was considerably oversubscribed, reflecting great confidence in SpiceJet's growth potential, according to a statement issued earlier this month.
It further stated that the Qualified Institutional Placement drew a diversified group of top-tier institutional investors and mutual funds, including Goldman Sachs (Singapore), Morgan Stanley Asia, BNP Paribas Financial Markets ODI, Nomura Singapore Ltd ODI, Tata Mutual Fund, and Discovery Global Opportunity Ltd, among others. The newly obtained funds will be used to operate grounded aircraft, purchase new planes, develop in technology, and expand into new areas, according to the airline.
SpiceJet admitted earlier this month that it failed to pay about Rs 427 crore in statutory dues between April.SpiceJet reported earlier this month that it did not pay statutory dues of almost Rs427 crore between April 2020 and August 2024 due to its "constrained financial position". The outstanding dues include Rs 219.8 crore in TDS (tax deducted at source), Rs 71.33 crore in GST, and Rs 135.47 crore in provident fund (PF) contributions.
The cash-strapped airline also said that 36 of its 58 planes are grounded, "primarily" owing to "alleged default" in payments to aircraft lessors, financial issues impacting aircraft maintenance, and a lack of components and spares.
In addition to the statutory dues, SpiceJet stated that as of September 15, 2024, it owed Rs 118.9 crore to its workers, which it intends to repay using monies from the QIP. As of September 15, the airline's airport dues were Rs 290 crore, with Rs 150.3 crore to be paid from the funds obtained. It also plans to invest Rs 370 crore to grow its fleet.
