The only thing that perturbs me about the RI is that its taken them so long to deliberate and announce. I understand that it has a dilutive effect and the board may want to consider other options first, but surely it need not have taken this long ... Just announce and get on with it ...

Haha i3lurker, you overestimate yourself. You're not considered a threat, more an irritant, like a mosquito! You know what they say about empty vessels - you're a prime example.

I think if anyone is Oberyn it is you. Coming in halfway through proceedings and trying to flaunt your "knowledge" ... When price shot up didn't see your shadow anywhere. When price start to come down, tu dia ... lai liao ...

Mana itu gap down? Eh wait, that's right, anyone who has been looking at this stock already expected the losses and it is more or less priced in. You mean the prominent investors all didn't expect a big loss this year and instead hoped for a profit? LOL. Come on you sour grapes and bitter fellas ...

Question now is the amount of funds that they will raise from this and the manner in which they will do so. A cumulative amount of RM2.5b raised will last the company till 2023.

Not sure what the big fuss is about the quantum of their full year loss. Not like its unexpected.

I suppose if AA wants to realign the cost structure, better to throw the kitchen sink at it (which it appears to have done) rather than do it by drips and drabs.

perx, TF said in the interview with The Edge that they are looking at a rights issue to raise about RM800m to RM1b.

I recently thought their Danajamin-linked loan would be sufficient to stave off a rights issue, but looks like it'll be in the region of RM1b as expected. In fact, in Feb this year, after reading the various reports and interviews, I had said in one of my comments that RI is likely needed to raise about RM700m to RM1.2b, so I would like to think that TF/AA is quite consistent in that regard.

Based on a very simplistic back-of-the-envelope calculation, AA has 3,812,190,000 shares outstanding. Based on a 1 for 4 rights issue (1 rights share for 4 ordinary shares) at RM1.00 per share, that will raise approx. RM950m.

@DickyMe -> all banks have procedures and processes to assess ratings of borrowers etc. before loans are made. Exceptional events like Covid-19 excepted, NPLs are low.

@AlexT12 -> your comments make quite clear you have no ability to assess things even at the most basic level. Obviously no travels now except for business and some other purposes. Its not like AA has not released its Qr results within the allowed timeframe. Plus AA does not operate in Europe nor does it rely on European travellers heavily - they are just icing on the cake. And comparing AA to MAS ... goodness. Seriously low level thinking.

TF did a brilliant, brilliant, interview with The Edge, covered in this weekend's The Edge. Salient points (mainly from a funding perspective) as follows:

1. AA looking to raise RM2b to RM2.5b to last till 2023. AA has raised approx. RM500m so far, plus Thai AA will be taking on a RM500m loan. Assuming Danajamin loan is RM1b, that'll be about another RM500m that is required. AA could ultimately raise much more than that.
2. Loans approved by 3 local banks, what's left is for Danajamin to approve.
3. Thai government will be giving Thai AA a loan of approx. RM500m. Thai AA is back to pre-covid levels.
4. Rights issue coming up, looking to raise RM800m to RM1b.
5. Investors being lined up to invest in AA's digital business.
6. Looking at securitising (not selling, know the difference) their data.
7. Aiming to penetrate the Cambodian market.
8. Rumour of AA going into ride-hailing is true. Key target are its passengers who need taxi services at the airport.
9. Cash flow positive in all digital businesses.
10. Not aiming to become a shopee, but concentrating on three key products in terms of online selling - food, cosmetics and fresh food.
11. Keen on digital banking licence, with a focus on serving SMEs instead of man on the street.
12. Biggest prize would be logistics - Teleport.

Hope this is useful to all investors our there. Have a good weekend!

I think the market needs or wants to know 2 things for now --> Q4 results, progress of Danajamin loan and will there be a rights issue.

Just feels like there will not be an RI anymore, especially if the Danajamin loan amount is big enough. An RI after this wouldn't look good especially since both tranches of PP were made at such a low price compared to the current one.

Those who rely on analyst reports are the most laughable. If you are a greenhorn then acceptable, otherwise ...

Whoever bought RM1.25 to hold for long term will have no issues with the short term fluctuations la... Time in the market > timing the market.

David Bonderman of TPG and several TPG partners - wow!

I think what's overlooked is the launch by AA of its Islamic e-commerce platform, Ikhlas. If that is done well, RM5 will be too low a TP...

My take, RM2.30 by end of the year, for the reasons enumerated in my previous posts and the other posters above (not the glove kakis!).

For the naysayers, go back to historical data. Look at when AA started plunging and the reasons for that etc. Put quite simply, RM1.70 should be the base case scenario for AA's price (derived from around May 2019). Don't forget that the price is based on a severe undervaluation of AA previously.

Now take that, and factor in:

- the cost structure that has now been revamped;
- other lines of businesses; and
- most importantly, the emotional factor in investing (in this case positive) -> based on inter-state travel bans being lifted by Q3, ASEAN nations in which AA is operating starting to operate domestically at full capacity by Q3/Q4 (FYI Thailand is already back at it full swing) and, finally, lifting of border restrictions within ASEAN countries by Q4/Q1 of 2022 (don't even need to factor in international border reopenings yet when the guai los will swarm Asia).

What will the price be then at Q4 2021? I'm afraid that even RM2.30 could be an underestimation.

From The Edge: Tony has just said that 'AirAsia "can survive" just on domestic traffic'. Assuming that means breakeven, imagine the revenue once international borders open up and digital business truly matures.

As with all stocks, if you think it will go down, it will go lower than you expect. Similarly, if you think it will go up, it will usually go up more than expected. In this case, I think the several estimates that it will go up to RM2.40 in 2023 or RM3.00 in 2024/2025 will be proven inaccurate. All things being equal and assuming the entire Malaysia is vaccinated by end 2021 and the entire Asean by mid 2022, I suspect a RM3.++ target for 2023 is actually not too far fetched. Not factoring in yet the potential of the digital business.

Looks like another PP coming. With all the loans that AA is supposedly trying to obtain/working on, an RI may not even be needed!

My suspicion is that a RI of 1 rights share for 5 ordinary shares will be called eventually (after the next PP and the govt loan is announced and done), with a targeted rights price of RM0.90. That will probably raise RM700m.

Sorry, re-read Tony's statement, and it looks like RM2.5b is the target, so RM700m remains. If they can get RM300m from other funding sources be it for digital and/or operations in the various countries, then looks like only RM400m more is required. Not a big sum and unlikely to dilute much if it comes in the form of an RI.

If they need RM2.5b, and have got RM300m from SDB, will have RM450 from PP (round up to say RM500m), and possibly RM1b from govt loan, making a total of RM1.8b, they still need about RM700m, that should come from RI. If they want to try for RM3b in total then need about RM1.2b from RI, unless assuming govt loan is for RM1.2b, then they will need about RM1b from RI.

In any event, it looks like an RI will come, only thing is how much and when. If govt loan is obtained within the next month as the article suggests, then likely price will move up and RI will be announced shortly after that.

So it looks like RI is needed to raise about RM700m to RM1.2b.

RI bila? Can't wait!

Big fundraising month for AA in Feb, according to Tony on his IG. I wonder when is the RI, want to subscribe.

I thought AA was supposed to only have enough cash to last till end of 2020/early 2021. The sale of shares in AA India may have given it enough to last one more quarter or so, maybe up to end of Q1 2021, so they will still need to raise some funds. But I see no news on PP nor RI. Wonder what's up ...

https://www.malaysianow.com/news/2021/01/06/return-of-mco-style-lockdown-on-the-cards-as-daily-cases-set-to-spike/

Until now RI/PP not announced. This is slightly concerning.

RI and/or PP? What have you heard?

For those holding long term/more than 6 months I guess this would be a no-brainer (RM1.70 should be the minimum once this goes back to normal, based on the price range immediately before Covid hit and without taking into account any RI or PP), but for those looking to trade or hold for a short term, please be mindful that RI or PP should be around the corner.

Canada has also approved the Pfizer vaccine.

I really hope their plan to raise funds will materialise ASAP. The amount of cash in the most recent quarterly statement is barely enough to cover 2 quarters =.="

Assuming a listco's share price is RM0.80 and its RI is announced at RM0.50, which is the likely scenario to follow announcement of the RI:

(a) share price fall to RM0.50;
(b) share price to hover between RM0.50 to RM0.80; or
(c) share price to stay at RM0.80 or in fact go up further.

Actually I'm quite concerned that the rights issue/PP is taking so long. I wonder what's the hold up. Hopefully its announced soon.

AA would still need infusion of cash whether by way of loan and/or equity. So far no news on this...I wonder if it'll be a PP or RI, suspect it'll be a mix of both + loans. Question is when will that materialise ... no news on this ...

50,000,000 shares were recently transferred by TF and KM's holding entity, Tune Live, after obtaining Bursa's approval under the B5 category, likely relating to a corporate exercise or increase in paid-up capital. Any idea if this sort of exercise relates to a private placement, rights issue or to both?

So 50,000,000 shares were transferred by TF and KM's holding entity, Tune Live, after obtaining Bursa's approval under the B5 category, likely relating to a corporate exercise or increase in paid-up capital. Looks like an RI is imminent?

Regardless of potential of its business, no banker in his/her right mind will lend to a company in AA's situation unless it is secured by substantial collateral, guaranteed by creditworthy parties and/or the company has agreed to do certain things (e.g. raise funds within a certain period).

1. Collateral seems highly unlikely as the company either may not have assets of that value to give as security or its assets are already charged/assigned to other creditors. An intercreditor arrangement may be possible but unlikely due to the nature of the matter.

2. Guarantee may be possible, either from TF/KM or soft guarantee from the state of Sabah or government of Malaysia. If TF/KM guarantees, they need to ensure that the company survives otherwise they will also need to out of pocket potentially the entire RM300m, so no. 3 below is likely.

3. Company doing certain things, e.g. taking on another loan of X value and/or fund raising (private placement or rights issue)? If another loan, see no. 1 and 2 above. If private placement, then up to 20% of the enlarged ordinary share capital can be issued to an investor/financier. If rights issue, TF/KM must mop up all the remaining shares to show confidence.

Everything suggests that further funding will be obtained in the near term.

“The first lot of financing will be announced by the end of this month, ” he said. :)

Anyone who attended the AGM care to shed some light on any material or important questions/points raised? Was out for a meeting so was not able to attend :(

AAB (the wholly owned subsidiary of AAGB) is supposed to hold close to 14% in AAX, but doesn't appear in the corporate structure chart set out in https://ir.airasia.com/misc/corporate-structure-30062020v34.pdf.

Anyone know the rationale behind it or is it due to the fact that the holding is not 20 or more so not considered an associate company? The chart shows all associate companies, jointly controlled entities and subsidiaries.

Agree with the comments above, i think likelihood of a RI is low.

If AA wants to raise RM1b from equity funds, it can either choose to do so (1) via private placement to investors (PP); (2) via RI; or (3) a mix of both.

-> Assuming it is (1), no RI involved. Recall that resolution (5) of the upcoming AGM is to allow AA to issue additional shares such that the additional shares issued do not exceed 20% of the enlarged share capital. Based on current number outstanding shares (3,342,000,000), that means AA can issue additional shares amounting up to 25% of that figure for a PP.

-> If (2), likelihood of AA doing a RI without being accompanied by a PP doesn't sound feasible, as AA needs to boost confidence before doing a RI to at least move the price up before a RI.

-> Assuming it is (3) and on the basis that PP and RI is shared 50/50, that means a RI will be to raise RM500m only instead of the full RM1b. That wouldn't have as big an impact on the shares as have been hyped. Assuming rights price is as high as RM0.60, RI will be on a 1 for 4 basis to raise that RM500m, which doesn't add as many outstanding shares as initially thought.

If AA needs RM2.5b in total -> RM1b from banks and RM500m from private placement, that will leave about RM1b to be raised via RI.

Assuming the news on securing the loan and successfully completing the private placement is released before RI is announced, price will likely move up to RM0.80 (at the very least).

AA has 3.342b outstanding shares. Assuming RI needs to raise RM1b and is priced at RM0.80/share, that means RI could be on the basis of 2 for 5 shares.

Resolution 5 of the upcoming AGM is the key one in respect of a private placement/RI, I think. 20% would be sufficient for a PP but unlikely to be for a RI. Will there be a separate vote on a RI or will the proposal be announced later for it to be voted on at the same time as the AGM?

"aggregate number of shares issued pursuant to this resolution does not exceed 20% of the total
number of issued shares (excluding treasury shares) of the Company for the time being"

AAX states that "In 2Q19, on a normalised basis, excluding the impact of an one-off adjustment for the disposal of the three aircraft via sale and leaseback in April 2019 ...". May I know where can I get more info on the disposal of the aircraft? Don't believe they've made any major announcement on that...

Is that why the "non-current assets held for sale" has dropped? if that's the case, wouldn't the sale result in again which should be booked? Perhaps to be booked in parts over the course of the lease?

"Non-current assets held for sale" dropped from 999,012,000 (from last quarter) to 384,368,000 (this quarter). Any idea why that's the case?

On a more basic point, it is common knowledge that IBs who issue warrants will try to manipulate pricing of the shares close to and up until expiry date. It is no different from goreng-ing a stock, just that in this case the price is pushed down. Question is why are such activities allowed - is it not considered manipulation or is there just not sufficient direct evidence to point it back to the IBs or do regulators just don't care?

newinvestor17, what's your take on AAX if you don't mind me asking? If you're happy to respond but don't think this is the right place to do so, perhaps can reply at the AAX page? Thanks.

I'd think a significant part of its oil has been hedged so likely not to be adversely affected for the next 6 - 12 months?

Dulu: keling is derogatory
Now: keling is reserved for best friend, not racist, commonly used

Typical hypocrites...I hope Tony keeps a lid on his Chairman. Mensiasuikan.

Ah ok, thanks. Suspend Monday, +3 clear market days, brings us to Friday which is the entitlement date. Looks like next Monday only can start trading.

Where to find reference to 1 week?!