On Thursday, shares of Interglobe Aviation, the parent of IndiGo airlines, touched its lowest level since October 2018 after it issued a warning that its "quarterly earnings to be materially impacted" from the dip in bookings, amid coronavirus fears.
The stock fell 18 percent to Rs 945, while shares of SpiceJet Limited dropped 20 percent to Rs 48.30 on Thursday.
On Wednesday, InterGlobe Aviation in a stock exchange filing said, "Over the past few days...week-on-week, we have seen a 15-20% decline in our daily bookings. Please note that the numbers could change from here based on how the situation evolves."
"We expect our quarterly earnings to be materially impacted because of the above. In addition, the rupee has also depreciated sharply which will have an adverse impact on our dollar denominated liabilities primarily on account of capitalized operating leases," it added.
The rupee, which moves in the direction of the stock markets, have remained over the 74/dollar level over the few days amid coronavirus concerns and Yes Bank crisis. While the fall in oil prices have curbed the decline, the domestic currency continues to linger near its all-time low.
On Thursday, fell close to 1 percent to 74.34 against the US dollar, fairly close to its all-time low of 74.48.
The rupee's depreciation hurts the dollar-denominated liabilities of airline businesses.
Further, India has imposed travel restrictions on foreign nationals by suspending "all existing visas, except diplomatic, official, UN/international organisations, employment, project visas" until 15 April after WHO declared COVID-19 as a pandemic. At least 73 people have been infected in India with the disease.