Cruger & R3D3, if we wish to continue discussion maybe we should move somewhere else, as here is spammer paradise during daytime.

Cruger, it just a screenshot, not full report

R3D3, don't worry, I feel your question is valid and that's why I reply to you.
Hedging will make you gain in down market and hurt you in up market, so it's quite normal to have hedging loss pre-2009, where ringgit is raising.
For valuation, most of the time I just look at Net operating income, it is excluded FOREX and tax. Sometime you saw there is so much gain in forex/hedging but when you look at cash flow it's totally different story. For airline, cash flow is much more crucial.

For leasing, if Indian media think MAA take advantage of AAI, then maybe they should suggest when it build up to financial self-sustainable stage and can take up financial leasing, AAI should pay MAA for the millions of discount they can enjoy. Let not take advantage of each other.

If MAA just want to take accounting advantage, they should have stop pumping another RM 114 millions last quarters.
For AAC part, I agree with you, they are pumping up AAC value, so that they could make billions ringgit net income from it. Businessman is not charity donor, they do what they can to maximise profit.

We all know AirAsia not good enough, but it's already the best they can do for now. No single airline in AP can achieve their profit margin, not a single one.

US have big enough market to compete and all FSC have stopped all fare war, but for us it ain't finished yet.

Frankly speaking, we don't have to advantage SW has : Full open skies.
SW is serving a highly populated southwest and mid west up to whole US 300 millions population.

Cruger, when price drop without reason, maybe bcos there isn't any reason, it don't need one. Good for us to collect.

I can't, haha, i am not insider.

Anyway, a lot of analyst are doubt about the RPT too, that's why spin-off of AAC is necessary.
The spin-off will improve AirAsia net gearing to 1.21. TF's RM1b private placement will further lower it to 0.87

For your comments on my blog, my reply: Future earning. people are aware of lower earning for next year, as fuel and USD has come back from their lowest in Mar 2016. Part of AirAsia's 2016 earning will not be sustainable and people are also worry about AirAsia's USD debt.

Hi R3D3,

1. Hedging: Yes, AirAsia is heavily rely on hedging. For any company that has any movement across the border, whether it's raw material, finish product, personnel or services, currency risk is an inevitable risk. You either don't cross the border, or you manage this risk. Unfortunate for AirAsia, they don't have a choice, aircraft and fuel are denominated in foreign currency. What make the thing worst is Ringgit is badly affected by our corrupted government. When currency drop, without hedging AirAsia will be even more badly hit.
For past 3 years, AA's hedging loss are (2015) 933 mil, 609 mil, and 385 mil. It look very bad, but if you look at note 27 of QR, you will notice that the actual loss without hedging are 1,876 mil, 712 mil, and 580 mil. They save 1,241 mil by hedging. (Aireen Omar has done a very good job)

Yes, AirAsia isn't a solid company, government wouldn't bail them out when they in trouble. I know i take huge risk when I invest in AirAsia, but I am comfortable as I have done thorough analysis and believe i will have adequate return. I manage my investment risk by keep a huge margin of safety.

2. Leasing/Related parties transaction: While Indian media is judging about AirAsia, normally I will read it very carefully as they are very bias against AirAsia, they take AirAsia as outsider and attacked it very badly, part of it due to IndiGo (India largest airline). Back to the overcharge to AirAsia India, that's not true if you look into detail and have some knowledge about aircraft type. Not all A320 are same, the VT-BLR Indian media claims overcharge is an aircraft with winglet, which provide 4% extra fuel saving and can be charge up until $390k per month. MAA may overcharge AAI for some aircrafts but they actually do provide some discount too. For Thai AA, they are enjoying financial leasing from MAA for all new aircrafts at probably the lowest in the world, due to AirAsia's big order, but nobody bother to talk about it.
For the receivable, I am not sure if CLSA aware AirAsia didn't recognise leasing income of 100mil a quarters for quarters before 4Q15? As IAA & PAA is almost completing their turnaround, the recognition is make sense.
I am very bullish about AirAsia, because my analysis tell me AirAsia worth more than RM3 a share at worst case scenario, and I have checked and find out the likelyhood is quite low. This is how I manage the risk.

This is my point of view, and you may see it differently. I take risk because i believe it worth it.

then i will just reply here =)

R3D3, found it, thank you.
Just wish to check with you, if I wish to make any reference for my reply, do you mind if I write it in blog?

Hi R3D3, will reply to you once I finish my work.
Anyway, for CLSA notes, i don't have access to it, appreciate if you could share it if possible.
thank you.

cruger, it's always a joy discuss with you.
I am totally agree with your viewpoint, 2017 is year about unleash AirAsia's hidden value.
growth/expansion will take time and will temporary lower then profit margin.

Op3rs, it's not he who I want to talk to, I just take that chance to tell why I believe AirAsia has an invisible moat : widespread network everywhere in Asean, with China & India underwork.
AA's nearest rival Lion Air is trying to do the same, but they have little chance in China and no chance at all in India.

helloworld123, i have same feeling too.

BusinessFinance, welcome to i3investor, seem like it's your first day.
I beg to differ with your view on AirAsia management too. From my point of view, AirAsia is constantly the airline with lowest CASK globally, which mean they have very good cost control.
In term of brand, they have the widespread network in Asean that nobody can beat, not even Lion air. This is AirAsia's economy moat.

Mind to make your point, please?

Anson1314, i like what u say!

Some number about higher dollar and higher fuel price in 2017 and its effect on AirAsia.
http://klse.i3investor.com/blogs/valuegrowth/112114.jsp

rMoi, PT Fersindo Nusaperkasa is a mining company, they probably having problem just to save themselves now.
http://listings.findthecompany.com/l/71543320/Fersindo-Nusaperkasa-PT-in-Jakarta-Indonesia

supermx2, remisier only have 8 days left to hit their sale target.

rMoi, major shareholder of IAA didn't paid, as highlighted in my article.

No luck, should be RM300 million forex loss, but i actually expect less than RM 100 million or even zero forex loss, tally with Q2 & Q3 forex results.
A lot of people only know who are TF & KM, but forgot there is an financial expert call Aireen Omar.

AP, only CIMB include AAC sale in their TP.

going in because price is high, going out because price is low, how much can you afford to cut lost?

never thought that airasia will drop so much again. Peter Lynch is right, we will always have chance to buy lower, patient is key.

STC1136, if that the case i will be very happy, waiting for my year end bonus to buy more.

AirAsia share is falling again, very good chance to buy low. Think to buy even more.

limkokthye, for your word "usd keep stronger , airasia cfm die", i can easily prove why you are seriously wrong about USD and oil price. let see if I am free tonight to write it.

DRB maybe good business, but it wouldn't be easy to really earn on it, unless a hardworking fund manager with big fund come & find its real value.

Calvin, when a company have so many different type of business and need many type of Analysing method to evaluate each of them, it is complicated. Auto is a cash flow business but may a lot of debt, while bank is an asset based business so debt is an issue. Pos office is asset base too but cash flow is low, each business is contradicting each other when come to analysis. Do you know individual investor do more homework than bank analyst? So when analyst come to this kind of conglomerate, they will not look into so detail and so it will undervalue some of their business, making the stock price unable to be fully valued.
The key reason a stock price double, triple or ten-bagger is not about how valuefull it's, but about how many analyst can understand the value of the stock.

No offence, but these are reason why I don't like conglomerate that don't concentrate at one business or real synergy.
If I have to invest in conglomerate, I will prefer like Jardine C&C, dairy farm, Jardine Strategy. Easy to evaluate.

calvin, haha, you know what happened when i decided to take a look on opcom since you say it? i google it and it bring me to a virus website....

thanks for advise, not interested in infrastructure company as it's very dependent on project. Not for DRB too, a very complicated conglomerate. I am a big fan of Joel Greenblatt and Peter Lynch, I don't buy a company i cannot understand or too complicate to analyse, as it will most likely undervalue due to market cannot understand it correctly.

I am thinking whether those number inclusive of AAX passengers, as some of photo show destination only operate by AAX. But if that the case, the result will be very bad, which i think highly unlikely when the PLF so high.

btw, AirAsia India is doing quite well.
http://dgca.nic.in/reports/Traffic_reports/Traffic_Rep1116.pdf

quite possible, if all PCS are paid by using proceed from IPO, that's RM 1.6 bil...

Smallplayernia, to know it u just have to keep reading this forum for 3 days and judge by yourself.
You are not the first asking

merck, just ignore him la

I think Indonesia law is at any time MAA cannot hold more than 50%.

The conversion doesn't need IAA's approval as stated in the t&c.
During the non-redemption period of the Series 2 issuance, the Subscriber shall have the right (but not the obligation), at its absolute discretion and opinion, to convert the whole or a portion of the outstanding amount of the securities, into fully paid-equity shares of IAA, at IDR 1,000,000 par value or at such par value then applicable due to change(s).

Coolinvestor, just ignore him will do. He is more happy when u talk about him.
He will stop when everybody just ignore him for some time.

Shark tank, that the risk of doing international business.
I am not saying I am 100% sure on that, but it's possible. The risk may not be fully on Airbus, but could be on their bank too. Few years back, who will know USDMYR can drop to 4.5?
99% of people believe oil price will never drop, while some believe it will rise to 1000 per barrel.

Yes, nothing to do with TF private placement.

Quite possible, I read somewhere in some case Airbus do do business in asian currency.
https://en.wikipedia.org/wiki/Competition_between_Airbus_and_Boeing#Currency_and_exchange_rates

I am looking into past 6 years QR for Forward Foreign Exchange Contracts of AirAsia used for aircraft purchase. Notice that no matter how many new aircraft deliveries or resale, the forward USD:MYR exchange rate is always fix at around 3.225 to 3.237, only the hedge ratio changed.
As it's impossible for AA to find a third party bank to provide such a good rate for past 2 years, it's most likely that AA has agreed with Airbus to fix all future aircraft purchase at around 3.225 few years back.
Which mean, no matter how much ringgit drop, significant portion of the cost for AA's aircraft is always fixed in ringgit term. It would be very huge advantage for AA in this low ringgit environment.

friend, why so hate about AirAsia?
From Indonesia to Japan/India, nobody need to spend ringgit.

By end of this year, the NTA of AirAsia will be around RM2.20, so I don't share the same view with you. Anyway, if you think RM2 is fair value of AirAsia, you could wait for it, =)

Apollo, Net gearing of AirAsia have reduced from peak of 2.50 in 2014 to current level of 1.47. Including RM1,006 mil private placement from TF&KM, it would be 1.12.
If AirAsia continue to reduce USD debt at TTM rate (average RM 658 mil net repayment per quarter) and make RM 400 mil PAT in 4Q16, the net gearing will reduce to about 1.

Not for now.
As MAA recognise RM 119 million (or IDR 392.7 billion, from FY2015) in 1Q16, that mean the total losses for IAA in FY2015 must have reduced by IDR 800 billion. As MAA already recognise all previous losses up to 3Q15, the combine of 800 billion with TTM results we know make the TTM IAA result become a profit of IDR 159 billion.

Salam, I believe with what TF said, AA worth RM6 per share, but that's before his private placement and depreciate of ringgit from RM4.10 to RM4.47.
After private placement and ringgit depreciation, it worth about RM4.00.