While varying possibilities are emerging, including the hunt for a new buyer and debt write-off, Jet Airways' viability has taken a hit. Over the past two quarters, a dramatic turn of events has spawned uncertainty around Jet Airways (JAL). Three-fourth of the airline's original fleet has been grounded. Rampant flight cancellations continue to dent its operations. Jet's berthing rights are being relinquished, especially at congested airports of Mumbai and Delhi, as well as international destinations. Yet, the share price of Jet Airways remains firm. 

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Edelweiss Research continues to assume a swerve back to profit during financial year 2020-21 and a fair enterprise value/EBITDAR of 7x. But given mounting risk, Edelweiss has cut the target price by 22 percent to Rs 177, and downgrading the stock from "Hold" to "Reduce".

EBIDITAR slashed by 35–49 percent:

The equity research firm has cut EBITDAR forecast for the airline by 35 percent for FY20E and 49 percent for FY21E. 

"Weaker EBITDA is likely to be partially offset by lower capitalised lease rentals as a result of the reduced overall fleet. We assume that JAL will eventually lose 50 planes to lessors, which would swerve its fleet size down to 73 in FY21E. Even if debtors are issued shares at a nominal price of Rs 1 doubling shares outstanding, we believe they shall have to take a commensurate debt write-down resulting in no change in equity value per share," the research firm said in its forcast. The research firm also forcast a dismal Q4FY19E. 

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According to Yatra.com CEO Dhruv Shringi, yields are up 15 percent YoY on domestic routes following several quarters of stagnant yields, enabling Indigo and SpiceJet to clock a  revenue per available seat mile (RASK) improvement of over 10 percent YoY in Q4FY19E. Coupled with a fuel cost per available seat-kilometer (CASK) fall by 1–5 percent YoY, Indigo and SpiceJet should witness 7x surge in profits in FY20E. 

Moreover, Indigo has doubled its international market share to 8 percent, capitalising on Jet Airways vacating key markets. In contrast, Jet makes losses in FY20E as well.