Thu, Dec 12, 2019 - Page 12 News List

Tigerair Taiwan stock to debut on emerging board

BUDGET CARRIER:The China Airlines subsidiary is counting on a young fleet, and its focus on young backpackers and new destinations to fuel growth

By Kao Shih-ching  /  Staff reporter

Tigerair Taiwan Co (台灣虎航), a low-cost carrier subsidiary of China Airlines Ltd (CAL, 中華航空), is on Monday to debut its shares on the Taipei Exchange’s Emerging Stock Board at NT$41 per share, making it the first budget carrier to be listed on the local bourse, spokesman Bernard Hsu (許致遠) told a news conference in Taipei yesterday.

Trading on the Emerging Stock Market, a preparatory board for the nation’s two main bourses, is restricted to securities firms, therefore the company’s shares would not be open to public subscription, Hsu said.

Tigerair plans to shift its shares to the Taiwan Stock Exchange in the fourth quarter of next year, Hsu told the Taipei Times.

CAL sold 45 million Tigerair Taiwan shares to its stockholders in September and now holds less than a 70 percent stake in its subsidiary.

Tigerair Taiwan in August said it would add 15 new Airbus A320neo aircraft to its fleet from 2021.

It plans to take delivery of the first three jets in 2021, with the remaining 12 aircraft to be delivered by 2027, it said.

The addition of the single-aisle aircraft would give new momentum to the carrier, allowing it to open new routes and meet growing market demand, Hsu said.

The carrier is considering expanding into several second-tier areas in Southeast Asia and Japan, including Da Nang and Nha Trang in Vietnam; Clark, Philippines; and Aomori and Akitaken in Japan.

“Most of our passengers are young people who love backpacking and exploring new destinations, so we must satisfy their needs,” Hsu said.

By 2023, 11 of the new aircraft would replace 11 A320 jets the carrier operates to keep the average age of its fleet low, Hsu said.

The carrier has no plans for new routes next year, except new red-eye flights to Seoul from next month, Hsu said.

Net profit was NT$703 million (US$23.05 million) in the first three quarters of this year, flat from a year earlier, while revenue rose 9.11 percent year-on-year to NT$8.8 billion in the first 11 months, company data showed.

Hsu said growth in net profit was capped by large investments to expand in the Philippines, as the carrier offered flights to two new destinations — Boracay and Palawan — which did not generate enough revenue due to low ticket prices amid intense competition.

As the number of passengers to the two destinations has steadily increased, the carrier plans to raise ticket prices next year, which should help improve its profitability, he added.

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