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Airline shares active, down ahead of results
by hlk Mon 22 Aug 2011, 17:31
KUALA LUMPUR: Shares of AIRASIA BHD [] and Malaysia Airline System Bhd were actively traded on Monday, Aug 22 ahead of their financial results scheduled for release on Tuesday, Aug 23.
At 3.15pm, AirAsia fell six sen to RM3.58 with 6.78 million shares done while MAS shed two sen to RM1.64 with 7.7 million shares traded.
Maybank IB Research in a note Aug 22 said it expects AirAsia's 2Q11 to show a marginal year-on-year profit growth buoyed exclusively by its Thai associate.
“We expect the Malaysian and Indonesian operations to exhibit profit drop due to 28% rise in fuel prices and soft yield environment, consistent to the industry and further exacerbated by Firefly’s jet operations services to East Malaysia.
“We maintain our Hold call at RM3.36 target price, based on 9.0x 2011 PER which is 10% discount to global LCCs’ PER.
Meanwhile, in a separate note the research house said MAS was expected to make losses in 2Q11 due to the impact of 28% higher fuel price year-on-year and some impact from the MENA civil unrest and Japanese natural disasters.
“Despite this negative environment, we advice investors to overlook this quarter as the Company’s future is much better now with stabilizing fuel price, new aircraft benefits and the tie-up with AirAsia.
“We maintain our Buy recommendation with a target price of RM2.70, pegged to 9.0x 2012 PER - on par with global peers,” it said.
At 3.15pm, AirAsia fell six sen to RM3.58 with 6.78 million shares done while MAS shed two sen to RM1.64 with 7.7 million shares traded.
Maybank IB Research in a note Aug 22 said it expects AirAsia's 2Q11 to show a marginal year-on-year profit growth buoyed exclusively by its Thai associate.
“We expect the Malaysian and Indonesian operations to exhibit profit drop due to 28% rise in fuel prices and soft yield environment, consistent to the industry and further exacerbated by Firefly’s jet operations services to East Malaysia.
“We maintain our Hold call at RM3.36 target price, based on 9.0x 2011 PER which is 10% discount to global LCCs’ PER.
Meanwhile, in a separate note the research house said MAS was expected to make losses in 2Q11 due to the impact of 28% higher fuel price year-on-year and some impact from the MENA civil unrest and Japanese natural disasters.
“Despite this negative environment, we advice investors to overlook this quarter as the Company’s future is much better now with stabilizing fuel price, new aircraft benefits and the tie-up with AirAsia.
“We maintain our Buy recommendation with a target price of RM2.70, pegged to 9.0x 2012 PER - on par with global peers,” it said.
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