SpiceJet shares slump 12% as airline placed under 'enhanced surveillance'

economictimes.indiatimes.com:

SpiceJet fell over 12% in intraday trade on Wednesday on reports that the aviation regulator has placed the airline under enhanced surveillance. The stock recovered some lost ground and was last trading at Rs 28.84, down 3.38% from the previous close. PTI reported on Tuesday that DGCA has put the carrier under «enhanced surveillance» amid multiple financial headwinds in recent months.

However, SpiceJet refuted any such development. The surveillance also comes against the backdrop of various lessors seeking repossession of aircraft leased to SpiceJet and some of the cases have been settled by the airline. DGCA has put the airline under enhanced surveillance for over three weeks now and it is an ongoing process, according to the PTI report.

The enhanced surveillance includes increased night surveillance and spot checks. The focus is to ensure that due to financial issues, there are no potential adverse impacts on flight operations and that there are no «cutting corners» on safety. The enhanced surveillance is also to check whether safety obligations are being met or not, the official added.

When contacted by the agency, a SpiceJet spokesperson said, «the information is absolutely incorrect and is strongly denied». No such communication has been received by the airline from the DGCA, the spokesperson said in a statement. SpiceJet, which has been facing various headwinds, has settled the issues with certain aircraft lessors.

On June 21, the airline said it has entered into a settlement agreement with Nordic Aviation Capital (NAC), a lessor for its Q400 planes. Even as rival IndiGo is making giant strides in recovery post the devastation induced by the pandemic, SpiceJet is not yet out of the woods. The company's shares fell