SpiceJet Share Price Plummets 12% in Two Days – Analysts Weigh In
SpiceJet’s stock has been under intense selling pressure, witnessing a sharp decline of nearly 12% over two consecutive trading sessions. The budget airline’s share price fell over 8% on Thursday, followed by another 5% drop on Friday. Investors reacted negatively to the company’s Q3 results, despite reporting a profit of ₹26 crore for the December 2024 quarter, a significant turnaround from a loss of ₹300 crore in the same period last year.
SpiceJet’s Q3 Performance – A Mixed Bag
SpiceJet’s revenue for Q3 FY25 was ₹1,651 crore, marking a 35% increase compared to the September 2024 quarter’s revenue of ₹1,077 crore. However, it was significantly lower than the ₹2,149 crore reported in Q3 FY24. The airline’s Passenger Load Factor (PLF) remained high at 87%, reflecting strong demand.
Despite an improvement in profitability, concerns over the airline’s revenue drop, market share decline, and operational challenges have led analysts to adopt a cautious stance.
Market Share and Passenger Load Factor Decline
According to ICICI Securities, SpiceJet’s market share fell by 10 basis points to 3.2%. Additionally, its Passenger Load Factor (PLF) dropped from 93.7% in January 2024 to 87.1% in January 2025, indicating a weakening grip on the domestic aviation market.
Analyst Ratings and Target Price Revisions
Following the Q3 results, Nuvama Institutional Equities revised its target price downward to ₹52 while maintaining a ‘Hold’ rating. The brokerage has cut its FY25E and FY26E EPS estimates by 14% and 13%, respectively, citing operational softness.
Technical Analysis – Key Support and Resistance Levels
On Friday, SpiceJet’s share price opened at ₹43.50, hit an intraday low of ₹42.40, and a high of ₹43.79 before settling lower.
According to Riyank Arora, Technical Analyst at Mehta Equities Ltd, the stock is trading near a crucial support level of ₹40-₹42. A rebound from this level could trigger an upward movement toward the ₹52-₹54 range. However, if it falls below ₹39, further downside pressure could push it even lower.
SpiceJet: Key Financial Ratios and Stock Data
| Metric | Value |
|---|---|
| Market Cap | ₹5,582 Cr. |
| Current Price | ₹43.6 |
| High / Low | ₹79.9 / ₹39.9 |
| Stock P/E | – |
| Book Value | ₹0.33 |
| Dividend Yield | 0.00% |
| ROCE | 1.64% |
| ROE | – |
| Face Value | ₹10.0 |
| Promoter Holding | 29.1% |
| Debt to Equity | 119 |
| Pledged Percentage | 40.3% |
| QoQ Profit Growth | 106% |
| Quarterly Profit Variation | 108% |
| Industry P/E | 28.3 |
| Graham Number | ₹1.08 |
| Intrinsic Value | ₹1.47 |
| RSI (Relative Strength Index) | 40.8 |
| EPS | ₹0.16 |
| No. of Equity Shares | 128 |
| PEG Ratio | – |
| 200 DMA | ₹54.8 |
| Free Cash Flow (3 Years) | ₹402 Cr. |
| Free Cash Flow (Latest) | ₹-659 Cr. |
| Debt | ₹5,018 Cr. |
Investor Outlook – What’s Next for SpiceJet?
SpiceJet’s recent performance shows signs of operational recovery, but revenue declines and a shrinking market share raise concerns. The airline has been grappling with financial stress, high debt levels, and liquidity constraints.
For investors, the ₹40-₹42 support range is crucial—a bounce from here could indicate short-term recovery, while a break below ₹39 might lead to further losses.
With a declining market share, weak financials, and a significant portion of pledged shares, the airline faces an uphill battle. While the stock remains a potential recovery play for long-term investors, traders should exercise caution given the technical breakdown risks.
Conclusion
SpiceJet’s share price drop signals investor concerns over the airline’s long-term sustainability despite short-term profitability. Analysts remain cautious, with price targets reflecting moderate upside potential. The coming quarters will be critical in determining whether SpiceJet can capitalize on passenger demand, improve its market position, and navigate its financial challenges effectively.
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.