Shares of long-haul budget carrier AirAsia X rose slightly in the company’s trading debut yesterday after raising US$310 million in Malaysia’s biggest initial public offering (IPO) this year.
AirAsia X shares topped the most active list, edging up to 1.27 ringgit by midday, or a 1.6 percent premium from its IPO price of 1.25 ringgit.
The offering, which comes amid a volatile period for global markets, comprised a public issue of 592.6 million new shares and the sale of 197.5 million existing shares.
Photo: Bloomberg
Aero Ventures, the biggest shareholder in AirAsia X, was the main seller of existing shares. It is controlled by AirAsia founder Tony Fernandes and several other Malaysians. After the IPO, Aero’s stake in AirAsia X dropped to 34.4 percent from 52.2 percent.
Billionaire Richard Branson’s Virgin Group, which owns Virgin Atlantic Airways, last year sold its 10 percent stake in AirAsia X, citing internal restructuring to focus on its own brand.
AirAsia X has said it would use proceeds of 741 million ringgit (US$233 million) raised from the public issue to repay bank debts and finance its expansion as it gears up for competition from Singapore Airline’s Scoot and Qantas Airways’ Jetstar.
Air travel in Asia is expected to grow 6.7 percent annually in the next 20 years, from 780 million passengers in 2010 to about 2.2 billion by 2030.
Budget aviation now has a quarter of the air travel market in Asia and is growing.
AirAsia X, which was launched in late 2007, flies to 14 destinations across Asia, Australia and the Middle East.
Analysts have said the IPO will boost AirAsia X as it seeks to establish new hubs to strengthen its network. AirAsia X axed flights to Europe last year and is focusing on more profitable medium-haul routes in Asia.
The airline carried 2.5 million passengers in 2011 and aims to increase its passengers to 7 million next year. It made a profit of 33.85 million ringgit last year on revenue of 1.28 billion ringgit.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
PRESSURE EXPECTED: The appreciation of the NT dollar reflected expectations that Washington would press Taiwan to boost its currency against the US dollar, dealers said Taiwan’s export-oriented semiconductor and auto part manufacturers are expecting their margins to be affected by large foreign exchange losses as the New Taiwan dollar continued to appreciate sharply against the US dollar yesterday. Among major semiconductor manufacturers, ASE Technology Holding Co (日月光), the world’s largest integrated circuit (IC) packaging and testing services provider, said that whenever the NT dollar rises NT$1 against the greenback, its gross margin is cut by about 1.5 percent. The NT dollar traded as strong as NT$29.59 per US dollar before trimming gains to close NT$0.919, or 2.96 percent, higher at NT$30.145 yesterday in Taipei trading
RSS