At this price. 2.18. MAA is valued at 6Bil. It's Thai AA at current price is about 3.7 Bil. But MAA is making about 5 times more than TAA is the last quarter. And MAA own 45% of TAA. Don't know what kind of ang mor Analyst from Deutsche Bank. Valued MAA even lower than 2.18. Gila !

Thanks VG.

Thanks. Really appreciate that. You have done more homework than anyone else here I must say

By the way a320 got extra 6 seats and less maintainance because it burn less fuel

Of course I am not comparing car and aircraft. Look at how much fuel AA consume last year. For 9 month2016 MAA consume about 1.16 bil of fuel . Let say full year it consume 1.55 bil ( anualised ) . And aussmme avarage 80 aircraft . An air craft consume about 19.4 million fuel. 15% saving is about 2.9 mil per year. Is that worth the money paying 15% extra ?

VG. Cant calculate that 15% more expensive aircraft but save 15% fuel is equal to no saving. Less fuel burnt meaning less maintainence. and you must also calculate how much the fuel will burn for the entire life span of the aircraft. It you buy a aircraft with 50% fuel saving and with 20% less price tag but grounded most of the time, that is actual more expensive than but a aircraft with 15% more price tag and consume 15% fuel. Just like you are buying a hybrid car with much more fuel saving compare to a normal car. and of course hybrid is more expensive.

r°Moi ... for your information, I am not looking at the load factor alone. I am looking at the passengers flied and the seats and the others as well. You are destined to be doomed if just relying on the load factor alone. You could throw zeo fare for all the availavle seat and get the 100% load factor.

r°Moi ... be constructive. You are always posting question and asking people to imagine the worst. It is not only AA but otherwise counter as well. I apologize if you got offended.

R3D3. I have to disagree with you on this issue. if the transactions is favorable to AAC, the 51% share holder will be jumping. Furthermore as point out by VG, the maintenance of the aircraft should be by the lessee but in AA report the maintenance is by AAC. So how could you said that is favorable to AAC ? There is no figure and fact to support that the transactions favorable to AAC. It is made to believe that favorable to AAC, because of the GMT and Bloomberg article ? But the figure show otherwise.

R3D3. I think we shall not make any guessing in investing because that leads us no where. yes I do agree with you 100% 28 aircraft delivery is something big. You and me have different opinion on whether AA cash flow can sustain the additional 28 aircraft. You have right to be skeptical and that is nothing wrong with that. In my opinion, the additional capacity could be well well absorded by the market demand. After all, currently the regional market load factor is high.
My take is this. In investing, they are times that we need to take bold move to make big money. Being too conservative will definitely lead us no where. If for the past 5 years you are holding Public Bank or Maybank, you return is nothing much to loud about. They are companies that worth the risk and AA is one of time ( for the time being ).
Yes. I do agree with you more than 101% that, the sale of AAC and the price is the most important thing now. If you vet through the current aircraft leasing company M & A, AAC could fetch a price tag of PE 20-25. I leave the price tag for your imagination. Of course that is the best case scenario. The worst case scenario there is no AAC sale at all. But I do think that is end of the world for AA. After all AAC is a very profitable company
One last thing. Running AA is running a business not running a political party which trying to run the others party down at all cost. If AA management didn't think that the additional 28 aircrafts for the group is necessary, there is always an option to sell the 28 aircraft off. In fact AA could make money with that. After all a lot of other leasing company is looking for aircraft. Thank for your input.

R3D3. I got your point. yes the figure is big and may spook anyone. I am not trying to convince you and I will not be convinced by your comments as well. Let see how it pan out, so far the jury is still out there.

R3D3 you are missing the whole point. You are too fixed on the debt and pay little attention to the cash flow. But cash flow is the whole point for AA. Capital commitment is nothing telling Airbus I am committed to take 83 bil of aircraft in future but see how lah in future. and Value has nothing to do with the share price. U dun have to show it here cos it is what you pay for a pice od AA not the value of AA that you get.

An mix. If that is true that will be a great news for Airasia. Imagine you could maintain that pricing with a more than 85% load factor that is a big loney there to be made.

VG. Thanks just send you a mail .... you can delete your email here just in case your email gor spamed hahahha.

KL Lee. This is from HL bank : " AirAsia has updated its fleet plan for 2017 with an expected growth of 26 net additional aircrafts (+15.9% yoy). Fleet expansion is expected to continue until 2028, with an average of 19-20 aircrafts per annum. New deliveries of A320NEO (15% fuel saving) has begun since Sep 2016, while the A321NEO (20% fuel saving) will begin in 2019. " ....

Ohhhh ... It is in the edge recently which I think iou can find the link in i3. Anyway here you go http://www.theedgemarkets.com/en/article/airasia-moving-full-steam-ahead

By the way reading Tony interview get me a bit spooked. Adding 28 aircraft each year for the coming years . That take a lot of capital. Unless it's cash flow can really match the expansion otherwise it will red flag all over the places . By expansion is good . It will make a lot of money if he can pull it off nicely. Let's hope for the best.

Thanks VG. Appreciate if you could email me the calculation. But is there any other way to tell uou my email ? I dunno how many enemies I made in this forum ha ha ha . Don't want to get my email spamed. Read enough spam on i3 already ha ha ha . Thanks.

By the way VG. I don't think the IRR value as explained by you in others post would be so straight forward. 1. The aircraft life span should not be calculated as 25 years for the enginer will need major overhaul after 8-10 years. that will be a cash out flow on this. 2. Not all the aircraft at ACC has same life span. hence the IRR shall not be applied to all aircrafts with single input. 3. AAC could add more aircraft in future hence it will be more cash out flow and inflow in future. So it is immposible to use IRR for its valuation like a toll highway like EPF buying Ekovest highway.

VG. If you look at the past record, AA could only have this sort of " pricing power " when MAS were dying for the past 2 years. I do agree with Ricky Yeo. But, Ricky, I think you area bit too negative about AA. As long as AA is the lowest cost producer, it will always has competitive edge. After painful years of bleeding capital do you think the other players want to go for another round of price war ? yes MAS and Makindo and adding the capacity. But if the industry doesn't see the huge demand, would you think all the players want to add capacity ? I am a bit on the positive side for I think the demand will still outpace the supply. Well that is my 2 cents. Eventhough the demand is slight lower than the supply it is not the end of the world and AA shall command a better PE price than current of less than 5 ( Base n anulaized 2016 profit ). But market put a price tag of the doom.

Two thumb ups for the write up .

One need an iron heart and very very strong conviction on AA future. I have full confidence on AA and its team.

Ok .. you are smarter than anyone. You are not bragging at all. You are the god !!! :). The only problem is you don't have sense of decency. :).

SharkTank. Diffrent people have diffrent point of view. it is not easy to be a contrarian. :)

VG. Thanks. It is always informative to read your article. I am still pegging AAC more thna USD 1 billion. The preivous 2 quater it is making 32 Million USD. I am pegging it straight forward at 32x2x20 ( PE ) = 1.28 Bil. I bet a lot of people will say I am crazy to peg it at this price. hahhahaha

yeap let's see ~

R3D3, I think you got carried too much away with the amount due from associates. The amount due will be reserved once AAP and AAI could operate on its own without the support from AA. If the plane of AAI and AAP are not from AAC, it will be straight away grounded long time ago once it fail to pay up the leasing fee. But because of AAC belong to it's paraent AA, it still could operate to come out with a plan to turn it around. That is the advantage of AA. If not you wont be about to see AA as it is now. Yes, the risk in investing in AA comes with risk, but we should weight the reward as well. The listing of AAp, AAI and the spin off of AAC did put a lot of value at AA.
Yeap, if you think that is too much risk for you to stomach, you better stay out of AA. Thanks for you input.

Valuegrowth I didnt go into that detail as you did. In fact I don't have that kind of idea of valuing. Appreciate you input. However, as we are talking about acquisition, an PE of 20-25 is actually doable. Imagine the cost and time involved to totally start a plane leasing company from the scratch. You need not only the asset, the clientes, you need a whole experienced team to manage and run. Furthermore, you may also experiences losses for the 1st new years. Not only that, you may not succeed in the end. In my opinion, the valuation of AAC is far more complicated than extrapolating the return of assets it has. The more accurate calculation shall be using IRR which is too complicated for retailer like me. At the same time we could not compare the PE of AAC with other listed listing company for example, if you want to buy BOC aviation now, I don't think you could fetch a price tag of PE 7-9. It could be much higher as what I meantioned in previous comment ( PE of 25 ). As for the higher leasing charge, I don't buy that at all.
1. AA is not the major share holder of associated company . It hold 49%. Do you think the 51% share holder will keep quiet if it is overchargeing ?
2. If it is overcharging, the figure will eventaully come back to haunted AA because after all AA hold 49% of the associated company.

BusinessFinance. What is getting worse ?

Valurgrowth. Now I wonder how much AAC worth... the latest transaction at 25 PE.... http://www.chinadaily.com.cn/bizchina/2016-12/23/content_27751269.htm

Icwin. If it is r cause of short selling. Then there is nothing to worry about. In fact u could make more money because when there is a short squeeze the shorter will need to cover back no matter what is the AA price. Let say if AAC is confirmed sale tomorrow shorter need to cover back and but back as much as possible eventhough AA skyrocket to RM6.00

By the way it is a corporate game. He has lost the battle for unable to control the board. Now he is not rote ring the TATA legacy but trying to tarnish it.

Cyrus is a joke. AA India is under his watch when the so call fraud happened. So when u lost control of the company you complainted. It is TATA who had chosen you as its chairman. When the TATA lost its faith in you you cried like a baby. TATA Under Cyrus nothing great happened and now he said wanted to protect the group legacy. Making him like he is the hero and TATA is the villain. Hello, TATA family is the founder heh...

Valurgrowth. I am more to and short term and long term type hahhaha... I want to see Moolla now. :)... I thin the cake is big enough for everyone. The senseless price few years back should be the past. market will come to sense eventually.

valuegrowth. if you read chinese i will suggest that you read this ... http://e-thg.blogspot.my/2016/06/blog-post.html... they are 3 parts of it. It is much better written than the garbage by some analyst. ...

ohhh ... OK... Then nothing to shout about. Just a few lines... Hmm We shall not jump into conclusion just because of a few lines with no figure to look into. Thanks.

ValueGrowth. I cant find the CLSA nite as mentioned by R3D3. Appreciate if you could share the link here . Thanks.

R3D3. Sorry I am referring to longterm amour due from associate. Instead of focusing on current amount due from associate I think we shll focus more on the cash flow of AA.

R3D3. If you are referring to the AA Insia issue in cgmalaysia I practically ignore it. 1. The amount involve is 13 mil only. 2. AA India so far is not the major profit contributor to AA operation. tge case is in the court. The case dosent warrant a major set back of profitability of AA in the coming quarters.

R3D3. You could say from moving money from left hand to right hand. But one must knows that The associate is only 49 % owned. In a way the losses in associate will eventually reflect into AA book. That is why a 798 million losses in Q42015. That is one of the reason they need to sell AAC. So what will it be it AAC is sold ? With the PP from tony and kamaruddin the balance sheet will looks really diffrent. Furthermore with the subscription of the PERPETUAL SECURITIES. Almost all the amount due will be almost zero.

R3D3. The leaasing profit is about 17% of AA total profit. As for the amount due from AA associate. It is down from 2 bil to 1 bil in q32016. After the subscription of Perpetual sesurities of 1 bil . I expect the amount due will be almost zero. If possible could your please share the link of CLSA . I will like to read also. Thanks.

Valuegrowth. When the price tanks I kept asking myself what did I miss ? So far I can't find a reason. Is it the depreciation of RM ? I don't think so. Mostly of the usd borrowing is hedge. Even the non usd borrowing be hedge at 50% till 2H2017. Competition ? Yes I did for see some degree of margin compression but that doesn't warrant the momentum of the share price drop . The perpetual security ? For that that is non an issue at all. In fact it is a good thing to get rid of the money owe from associates from the balance sheet. But on the other side I see huge value in aac, AAI and AAP IPO and healthier balance sheet in the coming years. Maybe the saying is right " when the thing is too good to be true, it probably is." Wish us luck. If I miss anything please comment.

BusinessFinance. I do not mean to offend, but I do believe you have more money than I am. But with due respect, you have your right to your sell call. I am just asking if you could share your experience. If you do not want to, that is fine. This forum doesn't belong to the rich only anyway. Who am I to complain.

Valuegrowth. I am focusing more in the value of AA instead of the growth in short term. Yes I do agree the competition will be there and always be there in fact. I also do not subscribe to the notion of AA going of shopping spree. There are period of expansion and there are period to stay put. For the past 2 years when the oil price was high, AA didn't focus in the expansion mood. In the coming 2-3 years it couldbe the best time for add fleets. Furthermore, ther eis always an option to delay the deliverery of future aircrafts. But for the time being I am focusing on AA unlocking it's value, AAC, Espedia, IAA and PAA listing and etc.

BusinessFinance. Hmmm that is too surface. If more in depth it will be much better.

BusinessFinance I believe everyone will be glad if you could share your analysis. After all we are all here to learn from anyone

OK. You could have your point of view. That is fine with me. So, could you please share with us where is the flaw of AA ? just a few lines doesnt weight much. Appreciate your input

Supermx2. Good luck

Ronnietan. AA is paying the loan with its cash flow. The rm 10 bil is a long term loan. Probaly 20-25 years I am not sure but the lifespan of an aircraft is typically 25 years . It is just like you bought a machine with loan to do business. As long as the machine produces cash flow to pay off the loan and with good profit it shall not be a problem. If you are paying interest of 4% but your net margin is 10% it shall not be a problem. Of course airline is a much complicated business. This is just a example.

no .. it doesn't bother me at all .... I will delete my comment as well .. because it is really pointless .... remeiser cari makan ....... cheers .... it is not the end of the world ......