Nuvama has maintained a hold rating on SpiceJet with a target price of ₹40 per share. At the current market price of ₹34.45, the target implies an upside of around 16 percent.
The brokerage highlighted that the airline’s Q1FY26 EBITDAR jumped sharply to ₹1,230 crore from ₹280 crore in the same quarter last year. The improvement was driven by lower available seat kilometre (ASKM), higher passenger load factors (PLFs), and elevated cost per available seat kilometre (CASK). Despite the improvement in yields, which rose 2 percent year-on-year, the brokerage flagged that ASKM was down 28 percent due to a reduction in fleet size.
Nuvama further noted that SpiceJet’s fleet expansion is likely to be delayed despite completing a ₹3,000 crore qualified institutional placement (QIP) and working through restructuring agreements with lessors. It expects the airline’s revival to remain gradual post the QIP and said a turnaround is a key monitorable going forward.
As a result, the brokerage cut its FY26E and FY27 EBITDAR estimates by 14 percent each to factor in the delayed recovery.
Disclaimer: The views and investment recommendations expressed above are those of Nuvama. They do not represent the views of this publication. This article is for informational purposes only and is not investment advice.
