SpiceJet: Flight to Recovery

Author: Soumya Chourasia

Co-Author: Namrata Roy, Assistant Manager Marketing, RICS India Pvt Ltd.
ABSTRACT:
From shutting down its operations for a day in December 2014 to showing profits after 7
quarters, SpiceJet has come a long way. The financial crunch it faced during that period led to
reduction of fleet, cancellation of flights and payment delays. To many it seemed as if the
airline would never fly again and meet the fate of Kingfisher Airlines, but it has; and through
a series of timely measures, is clawing its way back into customers' travel plans.
The airline announced a net profit of Rs 22.5 crore for the fourth quarter ending March 31,
2014 as compared to a loss of Rs 321.5 crore during the same quarter last year. The airline
also reduced losses during the FY15 fiscal to Rs 687.05 crore from Rs 1003.24 crore during
FY14.
What did it do? After its founder-promoter Ajay Singh took the airline back from its erstwhile
management, he cleared tax dues and salary arrears while launching an aggressive sales and
promotions campaign. The company also settled all payment related issues with aircraft
lessors and made sure that salaries were paid on time. It re-built the flight schedule and
refunded passengers whose flights had been cancelled.

KEYWORDS: SpiceJet, recovery, profit, dual fleet, strategy, Anil Singh, price stimulation,
load factor.