KUALA LUMPUR: Shares of AIRASIA BHD [] fell to as low as RM3.14 on Tuesday, Sept 20 in active trade on cautious market sentiment while CIMB Equities Research lowered its target price to RM3.98 following a delay in the listing of the Thai unit.
At 3.51pm, it was down 16 sen to RM3.19, the lowest since June this year.
CIMB Research had revised its target price lower from RM4.32 to RM3.98 as it implied lower price-to-earnings multiples of 12 times from 13 times to its FY12 earnings per share.
A news report said the Thai unit of AirAsia delayed an initial public offering of its shares to the first quarter of 2012 from the fourth quarter as the company needs more time to restructure its organisation and conduct due diligence.
Thai AirAsia had planned to raise up to US$200 million (RM622 million) from the IPO in Bangkok in the fourth quarter and the proceeds would be used partly for cash reserves and to repay debt.
CIMB Research said the delay could partly due to weakening capital market across the region as it believed that Thai AirAsia would seek the best timing to maximise money raising from the IPO.
“The IPO proceed is earmarked to repay its debts and to finance its aircraft expansion plan. In the same time, we see this news will spur weak sentiment over AirAsia shares as the concern possibility of further delays due to prolonged uncertainties in the capital market from the global economic uncertainties,” it said.
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