Stocks of aviation companies — InterGlobe Aviation, Jet Airways, SpiceJet, and Global Vectra — gained on Monday after the prices of aviation turbine fuel (ATF) were slashed by 2.1 percent to Rs 1.38 lakh per kilolitre.
Jet fuel prices had touched Rs 1.41 lakh per kilolitre last month, after a 16 percent hike.
Shares of IndiGo's parent company, InterGlobe Aviation, rose 1.3 percent, and touched an intraday high of Rs 1,808.9 on Monday. Jet Airways stock jumped 1.2 percent, SpiceJet was 6.7 percent up, and Global Vectra Helicorp was up 4.2 percent.
The jet fuel price cut was announced on Saturday after the petroleum and aviation ministers met representatives of aviation companies who demanded lower ATF prices. Aviation companies have reportedly lost thousands of crores rupees due to high jet fuel prices.
Jet fuel comprises 50-55 percent of the entire cost of airlines.
ATF prices are revised twice monthly, on the 1st and 16th, according to benchmark international oil rates. ATF fuel had a price increase of Rs 19,757.13 per kilolitre by June. A marginal rate cut of 1.3 percent was announced on June 1.
There have been concerns about a recession in major economies since then, which has caused the oil prices to soften internationally. The global oil prices have returned to pre-Ukraine war levels.
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