Jet Airways: Etihad lends a helping hand


Last week, when rating agency ICRA downgraded Jet Airways’ loan facilities to ‘D’ (junk status) due to delays in debt servicing, the company’s rejoinder was quick and sharp. “It is very disappointing that the recently published ICRA downgrade is based on a historic delay in debt servicing, which occurred and was resolved in the previous financial year. Our recently published first quarter results show a positive trend in performance and that the airline’s three-year business plan is on track,” it shot back.

Jet’s angst seems understandable. ICRA’s action could make it tougher and costlier for the airline to refinance its formidable debt of about ₹9,800 crore (as on June 30). This could again put the company on the back foot – at a critical juncture when its performance has shown some tentative improvement and strategic roadmaps to turn the corner have been unveiled.

After the disastrous ₹2,154-crore loss in the March quarter – the airline’s largest ever—the June quarter results offered a sliver of hope. The loss of ₹218 crore, while still quite stiff, was lower than the loss in the year-ago period (₹355 crore).

Full report here Business Line


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