SpiceJet closed business for a day in December 2014, owed Rs 2,100 crore in unsecured liabilities, had 5,000 employees, the oil marketing companies were hounding it for payments, lessees demanded their aircraft and the company needed something more than only an oil price collapse.
No one would have touched this company; Ajay Singh did.
This is what he might have seen:
One, Kingfisher Airlines had possibly Rs 12,000 crore in debt, against Rs 4,500 crore in annual revenues; SpiceJet needed only a bridge debt of Rs 1,300 crore, against Rs 4,000 crore in revenues.
Two, fuel prices were declining virtually every day; a peak price of Rs 77 a litre had declined to Rs 56 by December 2014 and the incoming chief executive officer (CEO) possibly placed his chips on a sustained erosion for his company to return to the black.
Three, he could possibly see that the average aircraft utilisation at 11 hours a day was about 90 minutes below what he considered easily doable.
Four, ancillary revenues were at eight per cent of all revenues, against a potential 13 per cent.
So, his crack team got down to fixing the company.
To Read the News in Full 21/03/16 Mudar Patherya/Business Standard
No one would have touched this company; Ajay Singh did.
This is what he might have seen:
One, Kingfisher Airlines had possibly Rs 12,000 crore in debt, against Rs 4,500 crore in annual revenues; SpiceJet needed only a bridge debt of Rs 1,300 crore, against Rs 4,000 crore in revenues.
Two, fuel prices were declining virtually every day; a peak price of Rs 77 a litre had declined to Rs 56 by December 2014 and the incoming chief executive officer (CEO) possibly placed his chips on a sustained erosion for his company to return to the black.
Three, he could possibly see that the average aircraft utilisation at 11 hours a day was about 90 minutes below what he considered easily doable.
Four, ancillary revenues were at eight per cent of all revenues, against a potential 13 per cent.
So, his crack team got down to fixing the company.
To Read the News in Full 21/03/16 Mudar Patherya/Business Standard
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