SpiceJet on Thursday said it has finalised a settlement with Avolon, one of the major lessors of the MAX aircraft, paving way for the resumption of service of 737 MAX (Boeing) jets.

SpiceJet is the only Indian carrier to operate Boeing 737 Max aircraft and this is a big positive trigger for the airline. The airline will be starting operations of the aircraft by the end of September. The company's Chairman and managing director Ajay Singh, in a statement, said that they expect a significant reduction in the operating costs because of this, and this will help improve their bottom line as well.

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Spicejet has been running in loss for many quarters now but things are improving as the passenger air traffic has definitely picked up in August compared to July and June.

Also Read: SpiceJet expects Boeing 737 MAX recovery soon, says CMD Ajay Singh

So multiple factors and of course, settling with their lessors is something that could definitely pick up the stock.

The Boeing 737 Max aircraft were grounded since March 2019 following two fatal crashes around the world.

India’s aviation regulator Directorate General of Civil Aviation (DGCA) banned Boeing 737 Max planes from operating after a Lion Air Max aircraft crashed in October 2018 and one operated by Ethiopian Airlines crashed near Addis Ababa in March 2019, killing 157 people, including four Indians.

According to a Moneycontrol report, the DGCA is conducting pilot training, flight testing and software testing on the Boeing 737 Max aircraft.

SpiceJet share today fell 1..46 percent to Rs 70.70 on the NSE.

Watch the accompanying video of CNBC-TV18’s Sonia Shenoy for more details.

(Edited by : Bivekananda Biswas)

First Published:Aug 26, 2021 4:52 PM IST