Maybank IB lifts AirAsia outlook on reopening of major markets

Maybank IB lifts AirAsia outlook on reopening of main markets


Whereas the Thai operations of AirAsia Group Bhd proceed to pull on the earnings of the low-budget airline group, the falling charge of Covid-19 infections within the area gives optimism for a longer-term restoration, says Maybank Funding Financial institution Analysis.

Thai AirAsia not too long ago reported wider third-quarter losses of THB2.1bil ensuing from a suspension of its flight operations to mitigate a 3rd wave of the Covid-19 pandemic within the nation

A “spectre of PN17 classification” looms over the Thai provider, stated Maybank IB, even because the Thai airline embarks on recapitalization and restructuring initiatives. Consequently, Maybank IB forecasts that AirAsia could take an enormous hit within the coming monetary yr.

“For FY22E, our core web loss estimate is twice than earlier than largely as a consequence of AAGB recognizing the large MYR1.1b in beforehand unrecognized losses from TAA,” stated Maybank IB.

Over the long term, the analysis agency emphasised a swing within the group’s web revenue to the black in FY23, underpinned by the decelerating charge of Covid-19 circumstances within the area.

There was a resumption of mass journey in all 4 of AirAsia’s main markets, together with Malaysia, which traditionally contributed 70% to 80% of group earnings.

In the meantime, Maybank IB additionally famous that the Malaysian aviation business is consolidating, which is optimistic for Malaysia AirAsia fares.

“We forecast FY23E to swing to a core web revenue of MYR255m from a core web lack of MYR439m earlier than as a consequence of larger MAA fares.

“With a worthwhile FY23E, we hope AAGB will not be categorized as a PN17 listed issuer by then (whether it is categorized as such on 7 Jan 2022),” it stated.

Including to the long run prospects, Maybank IB stated AirAsia can also listing its digital property, which is able to unlock lots of worth for the group.

Given the improved outlook, the analysis agency upgraded AirAsia to “purchase” from “promote” and raised its goal worth to RM1.36 from 36 sen beforehand.



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