Stock Name: AIRASIA
Company Name: AIRASIA BHD
Research House: AMMB
Company Name: AIRASIA BHD
Research House: AMMB
AmResearch Sdn Bhd expects AirAsia's first quarter 2011 earnings to test a record high at RM243 million, including gains from the US dollar debt translation.
The research house has reiterated a "buy" rating on AirAsia and estimates the airline to register a core net profit of RM145 million with results expected to gradually improve in the coming quarters.
"Bear in mind that the five per cent base fare increase in February will only flow into the numbers from the second quarter 2011 onwards, accompanied by an up to 75 per cent ancillary service price hike," it said in a research note
today.
AmResearch said every 10 sen strengthening of the ringgit should improve AirAsia's bottomline by four percent. Hence, the strengthening ringgit is a boon for the budget airline.
Meanwhile, AmResearch estimates a gain of RM419 million from foreign debt translation for financial year 2011 and up to RM98 million to be recognised in the first quarter 2011.
AirAsia's aircraft debt of 90 per cent is denominated in the US dollar.
"A yield upward trend should follow through into the third quarter when the fuel surcharge starts to be reflected in earnings," it said.
AmResearch said that the drop in jet fuel price of late would act as a positive earnings catalyst for AirAsia.
The research house said AirAsia remained the top pick in the aviation sector. -- Bernama
The research house has reiterated a "buy" rating on AirAsia and estimates the airline to register a core net profit of RM145 million with results expected to gradually improve in the coming quarters.
"Bear in mind that the five per cent base fare increase in February will only flow into the numbers from the second quarter 2011 onwards, accompanied by an up to 75 per cent ancillary service price hike," it said in a research note
today.
AmResearch said every 10 sen strengthening of the ringgit should improve AirAsia's bottomline by four percent. Hence, the strengthening ringgit is a boon for the budget airline.
Meanwhile, AmResearch estimates a gain of RM419 million from foreign debt translation for financial year 2011 and up to RM98 million to be recognised in the first quarter 2011.
AirAsia's aircraft debt of 90 per cent is denominated in the US dollar.
"A yield upward trend should follow through into the third quarter when the fuel surcharge starts to be reflected in earnings," it said.
AmResearch said that the drop in jet fuel price of late would act as a positive earnings catalyst for AirAsia.
The research house said AirAsia remained the top pick in the aviation sector. -- Bernama
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