Jet, SpiceJet deals with foreign players good for the domestic aviation and passengers: KPMG

27 November, 2012

The stocks of Jet Airways and SpiceJet jumped to a 52-week high after the reports of acquisition of their stakes by foreign airlines. According to reports, Abu Dhabi-based Etihad Airways is in talks with Jet Airways for takeover of its 24 per cent stake.

SIMILARLY THE reports also say that negotiations are going on between Spice Jet and Malaysia's low cost airline Air Asia that could end up with Malaysian airlines acquiring stakes in the former. However, the companies involved in the talks have neither confirmed nor denied developments.

Global consultancy, KPMG said that if the deals go through then it would be a win-win situation for the airlines as well as for the passengers.

“The Indian carriers will get access to much needed funds, global network, latest technology and management best practices. The global carrier would get access to the traffic originating from India’s interiors. The Indian passenger would gain from increased competition that is expected to lead to better offerings, seamless travel through code-shares and cheaper airfares," Amber Dubey, Partner and Head - Aviation at global consultancy KPMG told this citizen journalist .

Notably shares of Jet Airways was up by 13.22 per cent or Rs 66.85 to Rs 572.60. The stock hit a fresh 52-week high of Rs 598.80 before retreating a bit as reported by Hindu Business Line. Stocks of SpiceJet were up by Rs 6.05 to Rs 45.35 and the trading volume of 313.63 lakh shares was nearly four-and-half times more than the two-week average of 69.08 lakh shares on the BSE.