SpiceJet shares fall 42% in 2022 amid DGCA show-cause notice

SpiceJet is facing some turbulent times that have caused its share prices at the Bombay Stock Exchange to tumble around 42-43 per cent so far this year.

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New Delhi, July 7: SpiceJet is facing some turbulent times that have caused its share prices at the Bombay Stock Exchange to tumble around 42-43 per cent so far this year.

In the past six months several incidents that SpiceJet flights have been involved in was attributed to a number of technical glitches. The budget carrier has been alleged of non-adherence to mandated guidelines and is being probed the civil aviation authority DGCA.

SpiceJet’s share price which was Rs 68 in the beginning of the year slumped to Rs 39 on Wednesday.

In the intra-day trade on Thursday, the highest price of the company’s share was Rs 39.25 and lowest price was Rs 38.55.

The trouble picked up pace on April 13, the Directorate General of Civil Aviation (DGCA) had restrained 90 pilots of the airline from operating Boeing 737 Max aircraft after it was found that they were not properly trained.

On May 1, 11 passengers onboard SpiceJet flight from Mumbai to Durgapur in West Bengal were injured when the flight faced turbulence in the air. Two of the injured had to be put into the Intensive Care Unit (ICU). The DGCA had ordered a probe immediately after the incident.

On May 4, a Durgapur-bound SpiceJet flight returned to Chennai. After its engine developed technical glitch.

On June 19, a Delhi-bound SpiceJet flight had to return to Patna. After the plane caught fire after being hit by a bird.

On June 25, a Patna-Guwahati flight had to abort take-off due to a technical snag.

On July 2, a Delhi-Jabalpur flight of the small budget carrier had returned to Delhi. After the cabin crew noticed smoke inside the plane shortly after takeoff.

On July 5, a SpiceJet B737 aircraft flying from Delhi to Dubai was diverted to Karachi in Pakistan after an indicator light malfunctioned.

Taking a strong view of the incident, the DGCA issued a show-cause notice to SpiceJet for “failing to establish safe, efficient and reliable air services”.

“The reported incidents on aircraft operated by SpiceJet from April 1, 2022, till date have been reviewed. It has been observed that on a number of occasions. The aircraft either turned back to its originating station. Or continued landing to the destination with degraded safety margins. This shows poor internal safety oversight and inadequate maintenance actions. As most of the incidents are related to either component failure or system related failure (resulting) in degradation of the safety margins”. The notice said.

The DGCA has asked the carrier to explain why action should not be taken against it for failing.

Civil Aviation Minister Jyotiraditya Scindia has said passenger safety is paramount and even the smallest error hindering safety will be thoroughly investigated and course-corrected.

The airline said it has received the notice and will be responding within specified time.

“SpiceJet is in receipt of the DGCA notice and will be responding within the specified time period. We are committed to ensuring a safe operation for our passengers and crew,” a statement from the company said.

“We are an IATA-IOSA certified airline. SpiceJet successfully completed the meticulous audit program for recertification in October 2021. We have been regularly audited by DGCA. All our aircraft were audited a month ago by the regulator and found to be safe. All flights of SpiceJet are conducted in compliance. With the applicable regulations of the DGCA Civil Aviation Regulations on the subject”. A SpiceJet spokesperson said.

(Except for the headline. This story has not been edited by Business Upturn staff and is published from a syndicated feed.)