AirAsia soars; shares hit all time high

KUALA LUMPUR: Shares in AirAsia Bhd, which has been on an uptrend, settled at its highest closing price of RM4.14 on Monday since the company’s listing in 2004.

At market close, AirAsia shares gained 24 sen or 6.15% , its biggest move since May 2017, to RM4.14. Earlier, it hit an intraday high of RM4.15 at 4.30pm. The counter was the fourth top gainer on Bursa Malaysia with 17.07 million shares traded. Year-to-date, 

Other AirAsia securities were also trending upwards, with AirAsia-C53 closing eight sen or 39.02% higher at 28.5 sen while AirAsia0-C58 gained four sen, or 19.05% to 25 sen. 

The budget carrier is trading at 7.75 trailing 12-month earnings per share and 9.1 times its estimates for the coming year. 

Dealers said investors were looking at the possibility of a special dividend following the completion of a share-swap agreement between its ground handling unit and Singapore’s SATS Ltd. The move will see the low cost carrier realise some RM360.29mil (S$119.3mil).

MIDF Research said a special dividend may be on the horizon. “We believe there is a possibility of a special dividend. This is premised on management’s promise to pay out proceeds of business disposal. Assuming 100% pay-out of the RM360.2mil gain, the special dividend is estimated to be 10.8sen.”

The research house has maintained its “buy” call on for AirAsia with a target price of  RM4.02. 

“We like Air Asia because of the company continuous efforts to reinvent itself to ensure that it stays relevant in the highly competitive industry. 

“AirAsia remains our top pick for the aviation sector predicated on stable demand growth with conservative ASK expansion of 10.0%, and new areas of growth in AirAsia India and Air Asia Japan,” MIDF said.