Airline stocks up 1-6% after government removes flight capacity restrictions

Stocks

Domestic carriers will be allowed to operate at full capacity from October 18, the government has said

October 13, 2021 / 10:53 AM IST

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Airline stocks were in focus on October 13, gaining 1-6 percent in the morning trade a day after the government did away with restrictions on domestic flight capacity after almost 18 months

Domestic flights will be allowed to operate at full capacity from October 18, the government said in an order.

The decision to ease the norms was taken after reviewing the current air travel demand, the Ministry of Civil Aviation said.

“After review of the current status of Scheduled Domestic Operations viz-a-viz passenger demand for air travel”, it has been decided to “restore the scheduled domestic air operations with effect from 18-10-2021 without any capacity restriction,” the ministry stated.

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Capacity caps translate to the number of flights or departures that an airline can order as a percentage of a schedule during a season.

The capacity cap was first imposed in May 2020 when domestic air travel resumed after a nationwide lockdown to curb the spread of COVID-19.

At present, domestic carriers can operate at 85 percent of their pre-pandemic capacities.

Global Vectra Helicorp was quoting at Rs 62.10, up Rs 2.10, or 3.50 percent, and SpiceJet was quoting at Rs 78.45, up Rs 3.45, or 4.60 percent.

Interglobe Aviation, which operates IndiGo, was quoting at Rs 2,077.40, up Rs 37.55, or 1.84 percent and Jet Airways was quoting at Rs 99.55, up Rs 0.30, or 0.30 percent on the BSE.