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Bloomberg
AirAsia X Bhd’s restructuring plan was met with bleak forecasts and ratings from analysts as well as a 10% drop in its share price, underscoring the daunting challenges that lie ahead for the grounded carrier.
Public Investment Bank Bhd maintained its underperform rating and 1 sen price target on the airline, the long-haul arm of AirAsia Group Bhd. Max Koh, an analyst at KAF Equities Sdn Bhd, kept his sell rating and 0.02 sen target, saying he was neutral on the restructuring proposals “given the grim outlook.†AirAsia X’s shares headed for their biggest loss since August 3.
The airline said the plan, which it expects to complete by the end of next quarter, would wipe out almost 63.5 billion ringgit ($15.3 billion) in debt and save it from
collapse as the coronavirus pandemic continues to wreak havoc on travel.
The proposal requires approval from investors and creditors. Advance ticket payments will be converted into travel credits for customers.
AirAsia X said it hopes to begin operating with two aircraft in selected markets in the first quarter next year and gradually resume flights to all destinations by the end of 2021. The carrier said it would focus on flights within the five- to six-hour range and defer investment in new or immature routes.