Foreign investors see the potential and AirAsia has been and continues to be undervalued, says its chief executive officer
AirAsia Bhd is contemplating a dual listing, either in the US or Hong Kong, spurred by demand for its shares here from foreign investors.
AirAsia group chief financial officer Rozman Omar is currently on the lookout for advisers for the exercise.
PricewaterhouseCoopers LLP is the forerunner for the job, it is reliably learnt.
Earlier reports stated the low-cost carrier was looking at Thailand as an option for a secondary listing, in an effort to become a full-fledged Asean airline.
Now, however, the company has set its sights on more mature markets, considering strong buying interest in AirAsia shares from investors in the US and Europe.
Last week, AirAsia told Bursa Malaysia that as at 30 December 2010, foreigners held some 51.55 per cent of its shares compared with 48.07 per cent as at the end of June last year.
Foreign ownership in AirAsia is substantially higher than the average 22 per cent foreign ownership of stocks on Bursa Malaysia.
"They (foreign investors) see the potential. AirAsia has been and continues to be undervalued. People are beginning to see the whole potential of AirAsia.
"Our valuations do not include Thailand and Indonesia, which are very profitable now," AirAsia co-founder and chief executive officer Datuk Seri Tony Fernandes told Business Times via SMS.
According to data compiled by Bloomberg, some 30.37 per cent of AirAsia shares are held by the US investors, while the rest are mainly in the hands of investors from Europe.
The budget carrier has been quite a favourite with foreign investors, with ownership of its stock swaying between 45 per cent and 55 per cent in the last year.
An unorthodox branding strategy which has made it famous the world over, as well a relatively low price-to-earnings (PER) ratio of 9.0 times, have made it the darling of investors, especially foreigners.
Low-cost carriers appear to be the flavour of the day for foreign investors, preferring exposure to them than investment in full-fledged carriers, such as Malaysia Airlines and Singapore Airlines (SIA).
Another low-cost carrier that went public recently, Singapore-based Tiger Airways, for instance, also has a large following of foreign investors, at 44.6 per cent.
On the converse, the foreign shareholding in SIA is 9.81 per cent, while in MAS, it is lower still, at 2.13 per cent.
SIA is widely recognised as one of the world's most profitable airlines. - By Presenna Nambiar, btimes.com.my
airasia is certainly making waves :)
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