SpiceJet Clears Rs 160.07 Crore PF Dues Amid Financial Turnaround

Budget airline SpiceJet announced on Friday that it has cleared pending employee provident fund (PF) dues amounting to Rs 160.07 crore. The payments, which were delayed for over two years, mark a significant step in the airline’s financial recovery efforts.

In the last three months, the airline raised Rs 3,000 crore through a qualified institutional placement (QIP). According to a statement from SpiceJet, this infusion of funds has been utilized to address pending obligations, including employee salaries, tax deducted at source (TDS), and GST payments.

SpiceJet’s shares witnessed a surge of over 5 per cent from the intraday low following the announcement. At 2:45 p.m. on December 13, the stock was trading at Rs 58.44 on the Bombay Stock Exchange (BSE), reflecting a gain of Rs 0.65 or 1.12 per cent compared to the previous close.

The airline highlighted that it has been using internal cashflows to fulfill statutory commitments, such as PF and TDS payments. SpiceJet anticipates a reduction in interest outflows, which will further aid its financial stability.

Chairman and Managing Director Ajay Singh stated, “Clearing all pending employee provident fund dues is a significant milestone for us. This reflects our dedication to operational efficiency, fiscal responsibility, and employee welfare. Resolving statutory dues, alongside disputes with lessors and creditors, underscores our commitment to long-term growth and stability.”

Singh expressed optimism about the airline’s turnaround strategy, noting its focus on delivering quality service and sustainable expansion in the competitive aviation market.

SpiceJet reported progress in resolving disputes with aircraft lessors and creditors, which had previously strained its financial position. Legal challenges, including contempt notices from the National Company Law Tribunal and Delhi High Court, were triggered by unpaid dues to lessors, vendors, and suppliers.

The airline’s domestic market share has also seen a decline over the years. From 15.6 per cent in June 2019, it dropped to 4.4 per cent in June 2023 and further slid to 3.8 per cent by June 2024, according to data published in August.