SpiceJet strikes Rs 1.5 L cr deal with Boeing for 205 planes

Announcing the deal here on Friday, SpiceJet CMD Ajay Singh said the total order of 205 aircraft is valued at Rs 1,50,000 crore ($22 billion). “This is one of the largest deals in Indian aviation and the largest for SpiceJet,” Singh said. Currently, the budget carrier has 32 next generation B737s and 17 Bombardier Q400s. 

“We are honoured to build upon more than a decade of partnership with SpiceJet with their commitment of up to 205 airplanes,” Boeing VC Ray Conner said.

Singh said SpiceJet would explore different options for financing the deal. The induction of the new aircraft, which burn 20 per cent less fuel, would help SpiceJet reduce costs and enhance its ability to compete. “This is a composite transaction for purchase of up to 205 aircraft valued at USD 22 billion,” he said, adding that the focus is on growing the airline in a responsible and profitable manner.

After being on the verge of going belly up two years ago, the airline has been in the black for the past seven straight quarters. When asked about financing of the deal and its impact on debt to equity ratio, Singh said there would be no “equity dilution” and the balance sheet would be healthy.

In the 2016 July-September quarter, the airline had posted its highest-ever quarterly profit of Rs 59 crore. In the year-ago period, the same stood at Rs 29 crore.