AirAsia Shares Slip Amid Internal Reorganisation Plan
August 30, 2017 12:41 PM
KUALA LUMPUR, Aug 30 (Bernama) -- AirAsia Bhd's (AAB) shares eased one sen during the morning session today after being suspended during the afternoon session on Tuesday on announcing plans for an internal reorganisation and proposed transfer listing status to a new company.
At 12.02 pm, its trading volume stood at 12.79 million shares at RM3.32 per unit.
The carrier had announced a proposal for an internal reorganisation which involved the exchange of its entire issued share capital for new ordinary shares in a new company, AirAsia Group Bhd.
It had also announced the transfer of its listing status, expected to be completed by the first quarter of 2018.
In a separate update, AAB and its wholly-owned unit, AirAsia Investment Ltd, had executed multiple agreements to partially dispose of and subsequently convert its perpetual securities investments in PT Indonesia AirAsia into new shares in PT Rimau Multi Putra Pratama TBK.
AAB had also announced that it had provided financial assistance, in the form of a US$6 million (RM25.58 million) loan to PT Indonesia AirAsia.
The low-cost carrier also released its results, revealing that its pre-tax profit soared 52.4 per cent to RM386.8 million for the second quarter ended June 30, 2017 from RM253.81 million for the same quarter last year.
Group Chief Executive Officer, Tony Fernandes said that he was super happy with AirAsia's results.
"All airlines in ASEAN are making money. Yields are up, costs down," he said in a tweet today.
Meanwhile, most research houses maintained their call on AAB.
Hong Leong Investment Bank Bhd maintained its 'buy' rating, but revised AirAsia's target price to RM4.10 from RM3.82 as the airline is expected to remain on a growth trajectory from strong capacity expansion, high load factors and low jet fuel costs.
Public Investment Bank reiterated its 'neutral' view on the company with target price of RM3.19.