SpiceJet, the popular Indian low-cost carrier, has achieved a major milestone with a significant upgrade in its credit rating by Acuité Ratings & Research Limited. The agency raised the airline’s long-term credit rating by a remarkable four levels to B+ and its short-term rating to A4, assigning a ‘Stable’ outlook. This upgrade is a testament to SpiceJet’s dedication to financial stability, operational resilience, and strategic growth initiatives.
This enhanced credit rating is a strong indicator of SpiceJet’s strengthened financial position. It also provides the airline with increased flexibility and cost benefits, particularly in acquiring assets through financial leases. This advancement further supports SpiceJet’s commitment to expanding its fleet, enhancing operational efficiency, and delivering exceptional travel experiences to its passengers.
Ajay Singh, Chairman and Managing Director of SpiceJet, expressed his delight over the upgrade, stating, “We are delighted with Acuité’s upgrade of our credit rating by four notches. This is a testament to our relentless efforts to strengthen our financial position and improve operational efficiency. The upgraded rating will provide us with greater financial flexibility, enabling us to invest in our fleet, network, and customer experience. We remain committed to providing affordable air travel to millions of Indians and contributing to the growth of the Indian aviation industry.”
He further emphasized the positive impact of this upgrade, stating, “We are confident that this upgrade is just the beginning of a series of positive developments as we continue to stabilise operations and deliver on our commitments to investors.”
Acuité highlighted the key factors behind the credit rating upgrade, including the improved liquidity position following the infusion of funds through a Qualified Institutional Placement (QIP). SpiceJet successfully raised INR 3000 Crore in September 2024 through this QIP, attracting notable investors like Goldman Sachs, Morgan Stanley, and Nomura Singapore.
Acuité explained in a note, “The company has planned to utilize this fresh QIP proceeds to pay off the statutory dues, settlement with their lessors, employee salaries, general corporate expenses, ungrounding of fleet, expansion by adding new aircraft, etc. as per their revival plan committed to the investors.”
This positive development underscores SpiceJet’s commitment to its revival plan and signals a promising future for the airline. The upgraded credit rating positions SpiceJet for continued growth, fleet expansion, and improved service offerings, ultimately benefiting both the airline and its passengers.
