Investing in the stock market can be a thrilling rollercoaster ride, and when it comes to the aviation industry, every move by prominent figures draws attention. Recently, SpiceJet Ltd found itself in the spotlight with a rumor suggesting that Rakesh Gangwal, the co-founder of IndiGo, was considering investing in the low-cost carrier. This news sent SpiceJet’s shares soaring by nearly 18 percent in a single day. However, as is often the case with financial news, there’s more to the story.
Despite the initial excitement, sources close to Rakesh Gangwal have confirmed that he has no intention of investing in SpiceJet. Gangwal, who still maintains a 25 percent stake in IndiGo, is not looking to expand his aviation portfolio by investing in the rival airline.
The speculation of Gangwal’s interest in SpiceJet started when media reports suggested that he was in advanced talks to acquire a stake in the BSE-listed firm. However, a banker close to Gangwal has dismissed these claims, stating that he has no plans to invest further in the airline. The banker emphasized Gangwal’s current ownership in IndiGo and his lack of interest in SpiceJet, noting that Gangwal even views SpiceJet as a struggling carrier.
As of June-end, Rakesh Gangwal and his wife Shobha Gangwal held 13.23 percent and 2.99 percent stakes, respectively, in IndiGo operator InterGlobe Aviation. Additionally, the Chinkerpoo Family Trust, owned by the Gangwal family, holds a 13.5 percent stake in the company. With significant investments in IndiGo, it’s clear that Gangwal’s focus remains on the airline he co-founded rather than branching out into SpiceJet.
The banker’s statement reinforced the fact that Gangwal still owns a substantial portion of IndiGo, making any further investments in SpiceJet unlikely. Moreover, the banker suggested that Gangwal views SpiceJet as a struggling airline, making it an unattractive prospect for investment.
Notably, Gangwal has expressed his dissatisfaction with the misleading rumors that have surfaced, particularly since retail investors may be influenced by such baseless claims. To address this issue, he has called upon the Securities and Exchange Board of India (SEBI) to investigate the source of these rumors.
SpiceJet has faced financial difficulties in recent times, and its challenges were compounded when the aviation regulator placed it under “enhanced surveillance.” The airline had also faced legal disputes, such as the recent payment of Rs 100 crore to former promoter Kalanithi Maran’s KAL Airways, following a court order.
Despite these challenges, SpiceJet continues to operate, and the Indian government has initiated “Operation Ajay” to facilitate the return of Indian nationals from Israel. Both Air India and SpiceJet are participating in this operation, operating chartered flights to bring back citizens affected by the escalating tensions in the region.
Air India will operate a flight from the national capital to Tel Aviv, while SpiceJet will run a flight from Amritsar to Tel Aviv. These flights are part of the government’s efforts to support those who wish to return to India amid the Israel-Hamas conflict.
