Jet Airways has delayed paying interest on debentures coming due on 19 March, and grounded four more jets over defaults on lease rentals as the carrier’s cash crunch show little sign of abating.
The carrier disclosed that its interest payments “will be delayed owing to temporary liquidity constraints” in a stock exchange statement.
It did not provide details of the debentures, however an ICRA credit ratings report shows that it has a Rs6.99 billion ($102 million) debenture facility that matures in September 2020 with a 20.6% coupon rate.
The delayed interest payments come one week after the carrier informed the Mumbai stock exchange that it had also delayed a partial repayment of a working capital facility that was due on 11 March, also citing liquidity constraints.
In a separate statement, it confirmed that five more aircraft were recently grounded for “non-payment of amounts outstanding under their respective lease agreements.”
Based on earlier disclosures, 42 of Jet’s aircraft have been grounded for defaults on lease payments.
The delayed debenture payment and further groundings come almost one month since Jet’s shareholders green-lit a debt-for-equity swap with a number of its banks and other lenders in what appeared to be the first step in a bank-led restructuring plan.
To date there has been no indication that the swap has progressed, nor any further signs that the airline has agreed a plan to raise new capital.
The carrier disclosed in February that it faces a Rs85 billion funding gap, which will be covered through new loans, additional equity and aircraft sales.