Jet Airways saw one of the worst days of its trading history on Tuesday as investors distanced themselves from the grounded airline after its lenders decided to initiate bankruptcy proceedings to recover dues.
Jet scrip hit their lowest point ever of Rs32.25 per share, falling over 50% before closing slightly higher at Rs40.45 apiece, down 40%.
The company also informed about the resignation of two independent directors – Ashok Chawla and Sharad Sharma – in another sign that the chances of its revival were remote.
“Ashok Chawla and Sharad Sharma resigned as Independent Directors of the company with effect from June 17, 2019 in view of the board continuing to be in non-compliance with the provisions of the Companies Act, no additional directors being appointed and the process of the banks-led resolution plan not moving forward,” Jet said in a regulatory filing.
Information that Jet’s shares will be removed from daily trading of futures and options from June 28, further accelerated the fall in its shares.
The SBI-led lenders consortium on Monday said that it had decided to “seek resolution under Insolvency and Bankruptcy Code (IBC) as only a conditional bid was received and requirement of the investor for SEBI exemptions and resolution of all creditors is possible under IBC”.
Besides owing Rs85,000mn to public sector banks, the airline has a total liability of about Rs250,000mn, which includes dues of operational creditors.
Running out of cash, Jet Airways suspended its entire operations on April 17. Subsequently, the government re-allocated its slots and foreign traffic rights to rival carriers.
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