Mumbai, Aug 3 (IANS) Jet Airways’ scrip plunged on Friday following reports on the sustainability of the company even as the airline dismissed these as speculation.
At the BSE, the company’s scrip fell 7 per cent or Rs 23.20 per share to Rs 308 from its previous close of Rs 331.20 per scrip.
The slump in the company’s share price came after reports citing sources questioned the airline’s sustainability in view of its financial woes.
Later in the day, Jet Airways’ CEO Vinay Dube said: “… recent media reports about the sustainability of the airline are not only factually incorrect, but also malicious. The airline would also like to deny any conjecture of a stake sale.”
“In line with the company’s stated focus of creating a healthier and more resilient business, it has been implementing several measures to reduce costs as well as realise higher revenues, for desired business efficiencies,” he was quoted as saying in a statement.
“Some of these areas amongst others include, sales and distribution, payroll, maintenance and fleet simplification.”
Accordingly, the company has been in dialogue with employees and key stakeholders to implement cost reduction measures like pay cuts.
“The dialogue with employees has been to apprise them of the challenges being faced by the aviation sector in India and by the company in particular, with an intent to enlist their full support and cooperation for realizing necessary savings across all business functions,” he said.
“Despite the high growth environment, the aviation industry is currently passing through a tough phase given a depreciating rupee and the mismatch between high fuel prices and low fares.”
Dubey pointed out that various transformation initiatives identified and under implementation by the company will help in addressing the current issues faced by it and the industry.
“In fact, several transformation initiatives have already started to deliver positive results,” he said.
The company elaborated that it is committed to creating a growth-oriented and sustainable future.
Currently, the airline is in the process of adding 225 B737 MAX aircraft which will be inducted into its fleet over the next decade, of which 11 are slated to join within this financial year.