Shares of SpiceJet were trailing on Friday after it came under the regulatory scanner of the Directorate General of Civil Aviation (DGCA).
What Happened: On Thursday, the aviation safety regulator put the airline under enhanced surveillance with immediate effect following a special audit carried out earlier in the month, which revealed deficiencies in the airline’s engineering facilities.
The airline will now be subjected to increased spot checks and night-time surveillance to ensure operational safety.
“In light of the past record and the special audit carried out in August 2024, SpiceJet has once again been placed under enhanced surveillance with immediate effect. This would entail an increase in the number of spot checks/night surveillance with a view to ensure safety of operations,” DGCA’s statement said.
See Also: Mukesh Ambani Addresses Reliance Layoffs, Says Firm Created 1.7 Lakh New Jobs in 2023
This is the second the time the airline has come under the scrutiny of the regulator. Last year, the DGCA imposed heightened surveillance on SpiceJet due to reports indicating that the airline was experiencing financial difficulties.
Earlier in the day, passengers of the airline were once again prevented from checking in for their flights at Dubai airport due to delayed payments, the Hindu reported.
The cancellations were caused by delayed payments to the ground-handling service provider Dnata, which informed SpiceJet that it could either facilitate passengers or provide fuel.
Since the airline needed the aircraft for other flights, it chose to return the aircraft to India empty, the report said. SpiceJet later said in a statement that the flights were cancelled due to operational reasons.
Separately, the cash-strapped airline has also temporarily placed 150 cabin crew members on furlough for three months due to the “slow travel season and reduced fleet size,” aiming to ensure the airline’s long-term stability. The airline has been making losses for the past six years and is now reportedly struggling to pay employee salaries.
Price Action: SpiceJet was trading 4.42% lower at ₹63.30 on Friday morning.
Read Next: Why RVNL Shares Are Climbing Over 1% In Early Trade Today
Don't miss a beat on the share market. Get real-time updates on top stock movers and trading ideas on Benzinga India Telegram channel.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.