SpiceJet's stock witnessed a robust 3 per cent surge to reach a day's high of Rs 47.7 per share on December 5, following the dismissal of an insolvency plea by aircraft lessor Willis Lease Finance. The National Company Law Tribunal (NCLT) rejected the plea over unpaid dues, citing concerns about the maintainability and initiation of a new plea for the same cause of action without proper notification and court permission. In the last month alone, the stock of this low-cost carrier experienced an impressive 22 per cent increase, outpacing the 7 per cent rise in the benchmark Sensex.

The backdrop of this surge in SpiceJet's stock is set against a backdrop of challenges, with three aircraft lessors having filed a total of four insolvency pleas in 2023 due to non-payment of dues. Aircastle Ireland, Wilmington, and Celestial sought NCLT's intervention to admit SpiceJet to insolvency proceedings, aiming to recover outstanding dues. Notably, a tech services provider has also initiated an insolvency plea against the airline. While Willis Lease Finance's plea was dismissed on December 4, the tribunal's scrutiny highlighted procedural discrepancies, questioning the filing of a fresh plea for the same cause of action without prior notification and court approval.

SpiceJet's financial challenges have been compounded by operational disruptions across multiple airports in India, leading to delays in flight services, notably in Pune, Patna, and New Delhi airports. To alleviate its debt burden, SpiceJet had earlier, in August, allocated over 48 million shares to nine aircraft lessors, settling outstanding dues amounting to 2.31 billion rupees (approximately $28 million). However, the airline remains in a debt-laden state, prompting considerations for a fresh equity infusion.

In a bid to address its financial constraints, SpiceJet is reportedly exploring avenues to raise around $100 million, to inject fresh equity into the airline and refinance a portion of the promoter debt. Talks with several global funds are underway, with a focus on structuring a credit transaction, as indicated by a Moneycontrol exclusive report. The discussions centre around the pricing of the loan, marking a pivotal moment for SpiceJet as it navigates financial complexities to ensure operational sustainability and growth in a challenging aviation landscape.