Jet shares plunge 32% after suspending all flights

NEW DELHI: Jet Airways shares plunged as much as 32 per cent in afternoon trade on Thursday.

The company has temporarily suspended all flights with no cash to run operations any further. While Jet had been running a bare minimum number of 35-40 flights for the last few days, a total grounding will significantly affect its value for potential investors that are undergoing a bidding process to invest in the airline, an ET report said.

There are fears of its licence being subsequently suspended if it does not get its flights back up.

Jet Airways lenders on Thursday said they are reasonably hopeful of a successful bidding process for stake sale, a day after the cash-starved carrier suspended its operations.

The announcement from the lenders came early morning ahead of market opening.

"The lenders after due deliberations decided that the best way forward for the survival of Jet Airways is to get the binding bids from potential investors who have expressed EOI (Expression of Interest) and have been issued bid documents on April 16," a statement said.

Jet has defaulted on loans as well as vendor and lessor payments. It has been forced to ground planes since the beginning of the year primarily due to defaults to leasing companies. It hasn’t paid its employees since January.

Shares of the company closed 32.23 per cent down at Rs 163.90 apiece on BSE.

(With inputs from PTI)