Shares of Jet Airways surged over 6 percent Wednesday following the approval of India-Abu Dhabi air services agreement enabling their carriers to fly 50,000 seats each week, up from 13,700.
Mumbai: Shares of Jet Airways surged over 6 percent Wednesday following the approval of India-Abu Dhabi air services agreement enabling their carriers to fly 50,000 seats each week, up from 13,700.
After surging 8.27 percent to Rs 335 intra-day, shares of Jet finally settled at Rs 328.50, up 6.17 percent from its previous close on the BSE.
At the NSE, the stock ended 5.97 percent higher at Rs 328.45.
Tracking gains in the stock, the market value of Jet moved up by Rs 165 crore to Rs 2,836 crore.
The bilateral pact, which ran into controversy following the Jet-Etihad deal, was approved by the government yesterday.
The agreement received post-facto approval of the Union Cabinet at a meeting chaired by Prime Minister Manmohan Singh last evening.
The accord allows the designated carriers of India and Abu Dhabi to have 50,000 seat-capacity each week. This increase of 36,670 seats would be carried out in a phased manner, spread over three years.
While an additional 11,000 seats per week would be added to the existing 13,700 this year, another 12,800 seats per week would be added in 2014 and 12,870 more in 2015.
A major controversy had arisen with several MPs and political leaders objecting to this massive enhancement in bilateral air traffic rights. It had followed the signing of the Rs 2,058-crore deal between Jet Airways and Abu Dhabi carrier Etihad, under which the latter would pick up 24 percent equity stake in Jet.