5/20 rule done away with, fares capped; aviation stocks rally
The aviation ministry has called a meeting of all aviation companies in India at 4:00 pm on Wednesday in New Delhi.
The new civil aviation policy has got a go-ahead from the Cabinet, sources told Zee Business.
Under the new policy, there will be a cap of Rs 1,200 airfare for a 30 minutes flight and a cap of Rs 2,500 for a one-hour flight. Cabinet is likely to give its nod for abolishing the 5/20 rule for 0/20 rule. This implies that airlines will now be able to fly overseas without being in operation for a minimum of five years. They still need to have 20 aircraft.
The aviation ministry has called a meeting of all aviation companies in India at 4:00 pm on Wednesday in New Delhi. An announcement of the new policy is expected shortly.
The Civil Aviation Ministry had sent the proposed policy to Cabinet for approval on June 3.
Collectively, the aviation stocks were trading up 1.79% with five advances and zero declines in the afternoon trade on the Bombay Stock Exchange (BSE).
Among the leading aviation stock gainers on the BSE were InterGlobe Aviation which was up 2.88%, followed by Taneja Aerspace and Aviation with 5.28% and Global Vectra Helicorp with 2.5%
The stock of SpiceJet was trading up 2.65% whereas Jet Airways was up 1.37% in the afternoon trade on the stock exchange.