Shares of Jet Airways soared 5.5 percent while beleaguered SpiceJetjumped 7 percent intraday on Monday as aviation turbine fuel (ATF) is slashed by a steep 11.3 percent which now costs lesser than diesel.
In Delhi last month’s reduction saw the ATF price slip to Rs 52.42 a litre, below Rs 58.91 a litre cost of petrol. Post this cut it costs Rs 46.51 per litre and is cheaper than diesel that sells at Rs 51.52 per litre.
ATF attracts an excise duty of 8 percent. Jet fuel constitutes over 40 percent of an airline’s operating costs and the price cut will ease the financial burden of cash-strapped carriers.
At 09:42 hrs Jet Airways was quoting at Rs 533.50, up Rs 18.75, or 3.64 percent while SpiceJet was quoting at Rs 23.10, up Rs 0.90, or 4.05 percent on the BSE.