The shares of Interglobe Aviation — the parent company of Indigo — and SpiceJet fell substantially on Thursday primarily due to rising global crude oil prices.
Prices of Aviation Turbine Fuel (ATF) typically take cues from benchmark crude oil for price discovery.
According to reports, earlier in the month, ATF price was hiked by Rs 2,039.63 per kilolitre, or 2.75 per cent, to Rs 76,062.04 per kilolitre in Delhi.
Global crude oil prices are currently at around a seven-year high. On Thursday, crude oil futures on the New York Mercantile Exchange traded at around $89 per barrel, data showed.
Besides, fresh restrictions imposed to fight the rising Covid caseload in various parts of the country also dented the outlook of the aviation sector.
Shares of Indigo settled 5.5 per cent lower from the previous close at Rs 1,859. Since the start of 2022, it fell 8 per cent cumulatively.
Similarly, SpiceJet shares hit a 52-week low during the session and settled 0.6 per cent down at Rs 60.50.
Since the start of the calendar year, Spicejet stock prices declined nearly 11 per cent.