AirAsia X Bhd., the long-haul arm of Asia’s biggest budget carrier, had the second-worst trading debut in Kuala Lumpur in a year after raising 988 million ringgit ($310 million) in its initial public offering.
The carrier closed at 1.25 ringgit in Kuala Lumpur, same as the offer price. It was the country’s most actively traded stock with more than 160 million shares changing hands. The benchmark FTSE Bursa Malaysia KLCI Index rose 0.1 percent.
The share sale will help AirAsia X to take on debt to expand its fleet as the carrier plans to set up hubs in Thailand and Indonesia along with its partners, Chief Executive Officer Azran Osman-Rani said in an interview today. The IPO last month survived market turmoil brought on by concerns that the U.S. Federal Reserve will reduce stimulus and China’s economic slowdown may deepen.
“Right from the beginning we didn’t expect much from the initial listing,” said Ang Kok Heng, who bought the stock in the IPO as chief investment officer at Phillip Capital Management Sdn., where he helps manage $428 million. “This stock is meant for the long run.”
AirAsia X may also consider an additional hub in Chennai in south India, Azran said in a Bloomberg Television interview with Rishaad Salamat. The hubs in Thailand and Indonesia will help the carrier fly to Australian and Asian cities that are currently served from its Malaysian base, he said.
Washington Post
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