Aviation stocks sizzle on stake sale buzz

Nov 27 2012, 13:39 IST
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Shares of SpiceJet gain 12.98% while Jet Airways jumps 10.81%. (Reuters) Shares of SpiceJet gain 12.98% while Jet Airways jumps 10.81%. (Reuters)
SummaryShares of SpiceJet gain 12.98% while Jet Airways jumps 10.81%

On Monday, even as the BSE Sensex closed flat, individual stocks swung sharply during the course of the days trade on new reports and market rumours. Shares of SpiceJet and Jet Airways jumped by over 18 per cent on Monday amidst reports that Qatar Airways and Etihad are in talks with the respective Indian carriers for a stake purchase. Even Kingfisher Airlines saw its share price jump by 4.96 per cent during the day.

In September the government of India had announced to allow FDI of up to 49 per cent by strategic investors in Indian aviation sector and since then the aviation stocks have been on a rise.

However, on Monday, as the reports of stake sale talks of Jet Airways with Etihad and SpiceJet with Qatar Airways gained momentum, the two stocks jumped sharply. While Jet Airways shares closed at Rs 560 with a gain of 10.8 per cent before hitting Rs 598.8 during the day, SpiceJet shares rose by 19.2 per cent before settling down to close the day at Rs 44.4 with a gain of 12.98 per cent.

The two companies however issued clarifications during the day stating that they can not comment on speculative report. SpiceJet added that few investors have evinced interest in the company.

The rumours however were not limited to aviation stocks, there were reports of M&M buying stake in luxury sports car Aston Martin. M&M shares remained highly volatile during the day. While the shares opened flat, it closed the day at Rs 922 per share with a fall of 3.37 per cent on Monday. Later in the day, a PTI report said that The Investment Dar Company the Kuwait-based owners of British automaker has denied selling stakes in Aston Martin.

Reacting to the news that the company received two bids, including from M&M, for a 50 per cent stake in Aston Martin, a spokesperson of TID said the reports published in some media are inaccurate and have no truth in it. M&M spokesperson declined to comment.

Hindustan Copper Limited saw its shares plunge 20 per cent to hit its lower daily limit of Rs 170.45 on the BSE for the second consecutive session after governments stake sale.

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