AIRASIA Bhd's shares hit almost a one-year low of RM2.85 in mid-week amid concerns that the entry of a new player, Malindo Airways, could heighten competition in the low-cost carrier segment and suppress profit margin.AirAsia's shares, however, staged a mild rebound towards the end of the week in the wake of light bargain-hunting nibbling. Sentiment was encouraged by improved overall stock market performance.
AirAsia's shares closed the week at RM3.02.
Yesterday, the counter was among the most actively traded stocks on volume of 30.8 million shares.
Bloomberg's survey of 23 research houses that have updated their ratings on AirAsia put the average 12-month target price at RM3.67 for the counter.
Bursa Malaysia filings showed that AirAsia group chief executive officer Tan Sri Tony Fernandes and deputy group chief executive officer Datuk Kamarudin Meranun had over the week increased their stakes in the company. Their combined stakes were raised by 0.86% over a three-day period, and that raised their combined deemed interest in AirAsia to close to 24%.
Market dealers said that the move to increase stakes by AirAsia's key directors showed that they were committed to the business despite the impending competition from Malindo.
Affin Securities in its latest report said it continued to like AirAsia for the group's regional expansion, efficiency and sound fundamentals. It noted that the earlier selldown of AirAsia's shares was unjustified and provided a good opportunity to accumulate on the stock.
From biz.thestar.com.my
The comments above do not represent a recommendation to buy or sell.
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