Air Asia X at 65 sen, as valued by Tony Fernandez;Could it be headed down to 25-40 sen, as valued by Richard Branson?

As reported today,19 November 2014:

AirAsia X, the long-haul low-cost carrier, saw its share price fall to a record low of 65 sen on Wednesday after it sank deeper into the red with net losses of RM210.95mil in the third quarter ended Sept 30, 2014.

At 4.23pm, it was down 4.5 sen to 65.5 sen. There were 48.98 million shares done at prices ranging from 65 sen to 71.5 sen.

As reported on Sahathevan Blogspot, 22 July 2013:

Monday, July 22, 2013


Air Asia X worth between 50-70 sen according to Fernandes, 25-40 sen according to Branson

Maybank's "stabilization" of  Air Asia X's share price, which has not moved beyond the RM 1.25 IPO price , expires in about 2 weeks.

AAX's Bursa filings make  clear that Maybank's support is what keeps the price at even RM 1.25, thus raising the inevitable :what happens in 2 weeks , or less  , when the price is no longer supported?

Given recent past valuations of the company, based on transactions by company insiders (see previous posting below) , and after making some rough and ready adjustments for the IPO proceeds, but bearing in mind that share price is a function of earnings, it does appear that by Tony Fernandes's own reckoning AAX shares are worth only 5-70 sen (ie 40-50% of current price).

Based on the price Richard Branson asked for his shares, AAX is only worth 25-40 sen per share.

Friday, June 14, 2013


Tony Fernandes says AAX is a RM 3.1 B company, that was worth RM 1.25 B in 2008, and which plummeted in value to RM 660 million in 2012

As reported in The Edge Financial Daily, 28 June 2012:

Sir Richard Branson’s Virgin Atlantic Airways Ltd is expected to divest its 10% stake in AirAsia X Sdn Bhd to local existing shareholders for more than RM66 million (US$21 million)


".... investors got an inkling of Air Asia X’s valuation (in 2008)  when Japan’s Orix Group and Manara Consortium took a 10% stake each in Air Asia X for a total sum of RM250 million.
The deal effectively valued Air Asia X at RM1.25 billion."

".....“If it is true that Virgin is disposing of its
10% interest in Air Asia X for RM66 million, then the valuation
of Air Asia X has changed,” said a banker."

Readers are reminded that these were share transactions in a private company involving  long term shareholders to  which the existing  majority  would have had to agree. How much one buys and sells bits and pieces of one's own company is  likely to be more clear indication of how much one thinks the company is worth.

Given the above, Tony's current valuation seems fanciful.
posted by ganesh sahathevan @ 6:58 PM 0 comments
posted by Ganesh Sahathevan @ 6:55 PM

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