Trading curbs hit Jet Airways stock
Massive liabilities raise question marks over governance
- Published 14.06.19, 12:10 AM
- Updated 14.06.19, 12:10 AM
- a min read
The stock exchanges have imposed restrictions on the Jet Airways stock by shifting it to the trade-for-trade segment.
In the trade-to-trade category, investors have to take compulsory delivery and no intra-day trading is permitted.
The bourses say they have been seeking certain clarifications from the company about various rumours floating in the market. But Jet has failed to provide prompt responses, and the responses received were not satisfactory.
Moreover, the company has said it was not in a position to consider and approve the financial results for the year ended March 31, 2019.
“Considering these issues and the observations made by the auditor of the company, there are concerns about the continuity of flow of information about the company which is very vital for the appropriate price discovery in the scrip…
“As a preventive surveillance measure, it has been jointly decided by the exchanges that with effect from June 28, 2019 till further notice, the security of the company shall be shifted from the rolling segment to trade-for- trade segment,’’ the bourses said.
The decision hit sentiment in the Jet Airways counter, with the share falling nearly 18 per cent. On the BSE, the scrip ended 16.71 per cent lower at Rs 91.95 after plunging 23.18 per cent in intra-day trade to Rs 84.80.
On the NSE, the shares fell 17.72 per cent to close at Rs 90.75. In terms of traded volume, 35.05 lakh shares were traded on the BSE and over three crore shares changed hands on the NSE .
Consequently, market valuation fell Rs 209.47 crore to Rs 1,044.53 crore on the BSE.
Meanwhile, the National Company Law Tribunal (NCLT) has adjourned the hearing on Jet Airways’ insolvency case to June 20.
The tribunal has asked the two operational creditors — Shaman Wheels and Gaggar Enterprises (who had taken Jet to the the NCLT) — to again serve legal notices to the grounded airline. It has, therefore, refrained from admitting their plea for bankruptcy proceedings against Jet filed on June 10.
Jet Airways, which was grounded on April 17, owes Rs 8.74 crore to Shaman Wheels and Rs 53 lakh to Gaggar Enterprises. The airline owes more than Rs 8,000 crore to a consortium of banks led by the State Bank of India. The banks are still hopeful that Jet Airways will get a suitor and so far they have refrained from taking the bankruptcy route to recover their dues.