I have some sympathy for CapitalA having traded in and out of this position over the past couple of years. Observing the pattern for a while now, they have broken out (not yet decisively, I have to emphasise) of their 50 day SMA/EMA, very close to reaching their 200 day SMA/EMA and have very slowly but surely been trending up from the low from earlier this year (31 Jan 2022) and in fact close to breaking out from the long term trend line.

AAX is due to submit their reg plan end of this month, and from media interviews and reports, CapitalA (which is due to submit their reg plan by end of the year) may likely submit their reg plan either the same time as AAX or shortly after.

If that happens and the share price moves up, it could be a catalyst for a long term uptrend, provided of course the plan is approved (no reason to think it will not be endorsed, since the plan would have been prepared/reviewed by consultants and experts) and later carried out. The initial spike would, IMO, be the buy signal for this.

Not financial advice and DYDD.

Btw, the level of discourse in this forum (and i3investor generally, although there are some bright spots) ... NGMI ...

Agree that one should not catch falling knives now, price likely to stabilise only at ~RM0.53. But one need also differentiate between Serba and AA and the reasons for the PN17. AA has plenty of assets that have not yet been fully valued, so it would be interesting to see how this plays out.

What is the effect of PN17? Nothing much - AA has 1 year to submit a regularisation plan. Other than that it is BAU. What can or does AA need to regularise? Nothing. It won't and can't change its business and just needs to continue riding the recovery.

Thing is, Bursa jumped the gun and should've waited for the latest QR and the QR for first quarter of 2022 before deciding. Problem is that they have been called a paper tiger for the longest time and their performance in 2020 and 2021 was dismal, so they have no choice but to act tough now.

EV airplanes will take quite some time, but eVTOL would likely be operational in 3-4 years time if not sooner. Read somewhere that AA is looking into it, with Volocopter I think (not sure if its Volo or someone else). In any event, anyone who is interested in the space can look at Joby and Lilium, who look like the respective frontrunners in US and Europe/Latam.

Thank you azman1977 for warning us and giving us such groundbreaking false info. I'm sure you've done so from the goodness of your heart. Appreciate it, and appreciate you creating an account just for this. Great stuff!

I noticed something, the more Sslee comment, the higher the share price moves! Please continue! If you keep going on, think no need for DickyMe to wait too long for the RM4.50!

You just wait. When RI happens and price trends down as a result of that, they will be back again!

If analysts are so good at what they do, there's no need be an analyst anymore. Market is better off without them.

I recall TF once said that AA is also considering a data-backed loan for ~USD350m. Not sure if that will still be needed.

There's also the RI coming, and don't forget that AA can place ~200m shares more via private placement.

Danajamin approved? Aiyo... the haters how... :( Feel sorry for them.

https://newsroom.airasia.com/news/airasia-group-berhad-receives-approval-from-danajamin-nasional-berhad

With the RI coming up, and on the basis that it is fixed at RM0.75, any idea what will the impact be to the share price (e.g. will it typically be a 20% reduction or more) and when will that impact occur (will it be when RI is approved by shareholders or when it is finally subscribed and listed)?

BTW, I recall some weeks back reading TF's insta post about rebranding or changing the AA name, since it is now not just an airline. Anyone come across anything like that?

Hedging cuts both ways. Not hedging and passing cost on to consumer is the right way to go. The increase in ticket prices will not be substantial (as it is spread all around).

Anyway, no one ever says "nah, I don't wanna travel because oil is USD80/barrel and my ticket is RM10 more than what it's supposed to be."

Guys, in the midst of the excitement, don't forget the upcoming rights issue too.

@Jlee88, to add to your point, analysts currently only value AA based on its airline business. All other business streams have not yet been taken into account. *IF* things from a Covid perspective improve quickly and AA executes reasonably well (doesn't even have to be fantastic) over the course of the next year, it will be in line for a major rerating. What if it successfully lists its digital business and Teleport? Even better.

Of course, there is a risk that they execute the digital side poorly too. In that case, status quo.

I think one of the major points overlooked (and in fact unfairly criticised during the early days) is the transformation of AA into an asset light company. Its a symbiotic relationship now between AA and its lessors. Imagine if they had owned all the planes through the pandemic ...

It'll likely hover around this price or even retrace a little, until there is more encouraging news, e.g. concrete guidelines on opening up more destinations or securing of funding etc. So don't keep your hopes up that there will be a new high every day.

Bears always sound smart, it's the bulls that make money.

Sslee, why sell nasi lemak when other people also selling? Why sell insurance, why build houses, why... Bangsat la you...

But, but ... Tony ... no cash ... debt ... negative equity ...

Look, ultimately, what you and I or anyone says doesn't really matter. And you are flattering me for being a paid promoter, I wish I was paid to do that. We are just here writing to satisfy our own egos or justify our own views, that's all there is to it. Big fish don't care, unless if the big fish is KYY (and even then he probably isn't that big a fish anymore). So if you have a position, whatever it may be, all the best. If you don't, you're probably better off spending your time and energy somewhere else.

Lol, alleged. That's because no one details each and every one of his/her transactions here right. Who has time to do so, and who owes anyone the obligation to do that? And the reference to dividend doesn't only refer to that dividend itself. It also refers to the run up in price prior to payment of the dividend. Can one not have sold any then? What about the run up to RM4.50? Are you assuming no one sold then? Your statement implies you assume that is the case. Pretty naive to assume that. Your assumptions are made based on your laziness or incompetence, not sure which. Maybe both.

Lol, look at your own posts before criticizing others. You're a funny fella. Why pick and choose posts when you can reproduce the whole thing? You're exactly like an unethical reporter who crops and pastes and takes things out of context.

I took a big fat dividend from AA (thanks Tony) and cabut d la. Now seeing a good R/R play here, so am back in again. No need to be jack of all trade (stocks). Just master a few good enough.

Takkan wanna be like you, going around dissing people. You likely don't have very much at stake la... Continue talking cork.

Lol, its not the truth. Its just someone who is bitter. Surely everyone knows why the loans are being obtained.

Quite simply, I think there are just 2 groups of people who invest in AA. Firstly, those who bought high and who are stuck, but don't want to sell their shares because they believe AA can make it. Secondly, those who buy the shares because of the compelling risk/reward ratio. That's it.

If you hate on AA, you have the right to do so. But perhaps you would be better off focusing your efforts elsewhere.

If you are holding on t or have decided to buy AA because you think it is a good opportunity, all the naysayers are just empty vessels, nothing more than noise.

There are a number of reasons people spend time drafting detailed responses to comments, as described below. Some are just nonsense and crap that if you read makes you lose some IQ points, while some are well thought out. For the latter, whether it is right or wrong is another issue, as no one usually thinks they are wrong. If they are then they won't go through the hassle of defending their point. Key is that they have thought through the issues and have arrived at a conclusion.

Some of the key reasons, I think, are:

- Positive comments: Person holds shares in the company and wants to justify his/her position.
- Negative comments: Person has been burnt by the company and can't stand seeing other people make money. Seems to be the case for many here.
- Negative comments: Person will profit from a drop in share price.
- Positive/negative comments: Person has too much time on his/her hands. Either has plenty of money (hence time) or generally quite useless. The former will be few and far in between. Its mainly the latter.
- Positive/negative comments: Person genuinely wants to share his/her knowledge. Most unlikely, as one needs to be quite vested in the matter to spend time on crafting a proper response.

So do bear the above in mind and take the comments here with a pinch of salt, as everyone has their own agenda to sell.

@PSAi3alert, I think your reference to "financial services" is a little too out of context.

Firstly, what you had implied is that the late refund by AA suggests that it won't be a credible financial institution should it be a licensed bank. What I had said, is that both can't be compared against each other. This is because both industries clearly have each of its own sets of rules and regulations, and business is done according to the parameters of applicable rules and regulations, and there is no need to do more (although one can of course do so). I did not in any way say that AA is only in the business of aviation and not finance. As is clear, AA is moving towards being a diversified group instead of just running an aviation business.

Also, no one has suggested that BigPay is a saviour for AA. Its potential has been talked up, but no one has said that it is the silver bullet to fixing AA's business. It is only one part of the business. This is not lost on anyone.

Finally, the beauty of financial engineering is that anyone can make any assumptions in order to derive a number that he/she wants or doesn't want. I am not suggesting your calcs above are right or wrong, but isn't that what an analyst will do? If a stock's price is in a downtrend, everyone will tweak their assumptions and revise figures downwards, and if a stock's price is in an uptrend and business prospects improve, analysts will waste no time in suddenly changing their tune. In some ways, that is what all of us are doing as well to convince ourselves that we are right and those who do not agree are wrong.

I'm not sure if my tone comes across as being offensive or aggressive, but if it does then I apologise, will need to learn how to write better. I actually like and appreciate exchanges like this, as it helps with assessing downsides. I may be stubborn in depending this position, but am happy to hear contrarian thoughts and to learn from it.

@PSAi3alert, then you obviously don't know how the aviation industry works. How many major airlines of AA's scale has completely and totally refunded each and every single ticket that was purchased but could not be used because of lockdowns/pandemic? Plus, AA did not say it will not refund. There is a choice of taking a credit or being refunded, the latter which will just take more time, for obvious reasons.

Comparing airline industry vs banking is like comparing apples vs oranges.

So AA should not sell what was already a very small stake in Fly Leasing just to avoid a tough negotiation. You must be joking?

If you've been involved in sale and purchase of businesses, shares, assets etc. then you will know that there is more to valuing it for the purposes of a sale/purchase than just plucking a number from a website.

Surely money raised is to be used? Or did you expect AA to raise money to then put it in FD? The RM2.5b is the total figure intended to be raised, and comprises the sources mentioned in (a). It is not RM2.5b excluding (a). (c) may be speculative but (b) is not. Its not a done deal but at least we know it is in the works and there are public documents to that effect. I don't disagree with your point on LTIS free shares ratio.

As to the 3Cs that you mentioned, if that truly applies then almost each and every major airline who leases planes will face that same difficulty. Of course, unless that airline has consistently been making full lease payments throughout the pandemic even though there was no business to be done. If you know of any such company, please please do let us know - doesn't make for a good investment if you ask me!

@PSAi3alert, I hope you're not doing business. Doesn't appear to me that you know how to use debt as leverage ...

So Tony said in AA's press release on the Fly Leasing transaction, that "Our plan to raise up to MYR 2.5 billion ringgit through a combination of borrowing and equity raising is on track. This transaction delivers a welcome boost to our overall fundraising strategy."

(a) AA has raised ~RM336m from private placement, received ~RM150m from sale of AA India, and sold USD130m (~RM520m) from the sale of spare engines. This makes a total of ~RM1.0b.

(b) AA has an upcoming RI to raise RM1.0b and can place ~200m shares (assuming RM0.7 per share, that would make RM140m), This makes a total of RM1.14b.

(c) There is also the Danajamin loan (total say RM500m) and a data backed loan of USD350m (~RM1.4b) that is in the works. This makes a total of about RM1.75b.

(a) + (b) is approx. RM2.14b (say RM2.0b to be conservative)
(a) + (b) + Danajamin is about RM2.5b.
(a) + (b) + (c) is approx. RM3.89b (say RM3.5b to be conservative)

The above is not including SK's financing to BigPay. And does not also factor in any SPAC listing in the US.

@SMGaspar, well said.

@In_Sight, ignore DickyMee and his ilk.

Pretty ok AGM I'd say. Tony and senior management answered lots of questions, but nothing that we do not already know. One interesting point is that the Danajamin loan already has RM500m committed funding (Tony let this slip as it wasn't on the slides that he was reading from), likely can be drawn down/utilised soon. Other portion is under discussions with financiers.

lol @ In_Sight, I pity you. Feels like you are trying to use sound logic and common sense to explain something ... to a wall.

Anyway, haters gonna hate and no amount of your explanation will sway them. They've made up their mind. I suppose we should let them be, the only problem is that they are hogging up too much space and oxygen without contributing anything constructive here. Bloody irritating.

Sien. This is supposed to be a forum where ideas are exchanged, not for the "It is going to RM0.25" crowd to just spam that. Same goes for the "It is going to RM4.50" fellas.

@Alice7591 - Just an application to extend the date to place the remaining 198 million pp shares.

@machoman888 - In_Sight has stated it well, essentially, no need to pay more to convert from RCUIDS to ordinary shares. But please bear in mind that AA will start redeeming the RCUIDS from the 4th year onwards (25% for each of the 4 years, starting from Year 4). So if you hold until end of tenure, there'll be almost nothing left to convert. If you want to convert ALL of the RCUIDS, you need to do so before AA starts redeeming them.

One more thing that should also be kept in mind, is that AA still has 198 million shares that it can and intends to issue by way of private placement.

@ykyew11 What have you read / heard / seen which indicates that AA will be working with Dacsee?

For those who only have negative stuff to say about AA, you are fully entitled to do so and in fact some of you have good reason to be pessimistic about the counter. But most of you seem so bitter or angry or having a case of sour grapes. Would you mind letting us know what is the cause of the bitterness / anger? In fact, do you even have much money staked on/against this counter?

Did you previously lose a lot of money on this counter? You have yourself to blame.
Do you need the attention? Did your parents not give you enough attention when you were little or gf/wife/bf/husband not giving you enough attention now?
You are just generally a bitter person who can't stand seeing others do well?
[Insert other negative traits]

What is it actually? There's a saying "how you do something is how you do everything". Really pity you guys having to live with such a negative mindset...

@zeref99, no need to pay to covert, just need to surrender the RCUIDS which will be converted into mother share.

Sorry, to clarify, my question is based on the scenario where the mother share is lower than the exercise price, thanks.

BTW, would anyone know what is the average range/discount that a warrant usually trades against its exercise price? I know this is fairly speculative and broad, but if a warrant's exercise price is RM1.00, how much/what range would the warrant trade at? Any rule of thumb?

@Stockholmes - the entitlement date is to be decided by the board. If you hold shares on that date then you will be eligible to subscribe.

@siowlang - Para 2.2(i) seems to indicate that it is RM0.75 for subscription and RM0.75 for conversion. I could be mistaken. In fact, I hope I am!

@Sunshine - yes, it is RM0.75 to subscribe + RM0.75 to convert, so RM1.50 in total. Commercial call by the board I suppose.

Not a bad deal if you consider the fact that if the RI is issued in Dec 2021, it will need to be redeemed starting on the 4th anniversary (Dec 2025). Every year from Dec 2021, the RCUIDS will pay out 8%p.a., i.e. RM0.06/year/RCUIDS. Assuming you convert in Dec 2025 immediately before redemption, your cost (calculated on a very simple basis) is RM0.75 (subscription) + RM0.75 (conversion) - RM0.24 (RM0.06/year for 4 years) = RM1.26/share in total.

If you think AA shares are worth RM1.26 come Dec 2025 (I personally think it will be significantly higher even before then), then its a good deal. If you don't and choose not to convert, AA will just redeem the RCUIDS, so it would not dilute the shareholding pool. Quite clever structuring, actually.

As I had mentioned in my posts in February, March and May, all indications pointed to the fact that AA is looking to raise up to RM1b in the form of RI. That has now occurred, so this really shouldn't come as a surprise. I would, in fact, think that it should be considered a positive as it addresses a funding need.

What does AA's "rights issue of redeemable convertible unsecured Islamic debt security/RCUIDS" entail? Essentially, for every 6 AA shares you hold, you get to subscribe for 2 RCUIDS (and get 1 free warrant when you do so), i.e. 6 AA shares = 2 RCUIDS + 1 warrant.

As it stands, you need to pay RM0.75 to subscribe for 1 RCUIDS, and pay RM0.75 if you wish to convert it into an AA share. As long as you do not convert, the RCUIDS will pay interest of 8%p.a. on a quarterly basis. Take note that AA MUST redeem (akin to a buy back) any unconverted RCUIDS on and from the 4th anniversary from issue date, based on a redemption timeline of 25% on the 4th anniversary, 25% on the 5th anniversary, 25% on the 6th anniversary and 25% on the 7th anniversary.

As for the warrants, they have a tenure of 7 years and will have a maximum exercise price of RM1.00 each.

Is this spike in anticipation of announcements on new capital initiatives? No other reason for the increase in price.

Recall that Tony said during his interview with BFM on 23 July (when asked on timeline as he had previously said that June 2021 would be around when funding details will be made available) that he is committed to the timeline, give or take a few weeks, and that July would be when the capital initiatives would be made known.

In fact, he also stressed that Danajamin was not the issue and the banks are putting in their applications progressively for it.

Just be mindful that there could be a rights issue. Assuming price moves up to RM1.20, rights may be priced around the RM1.00 region. Be prepared to subscribe. Hopefully its announced quickly, as it needs to be concluded by end of the year to avoid AA being classified as a PN17 company.

Huntercrazy, where is your news from? I've been waiting for that forever. In fact I'm even worried that it's taking so long to announce!

The lockdown has largely been priced in by the continuous increase in cases. If it was a sudden decision then there'll be a huge drop. But investors already expect the flying business not to contribute much to earnings until things get better, so all eyes are now on progress of the vaccination programme and AA's funding plan.

Lol. Absolutely agreed on "rent seeking blokes hovering like poop flies". Lousy Malaysian "culture" that I think is the main issue why we're lagging behind other countries. That, and the "kesian" culture. Do something wrong, kesian la ... bagi chan la .... Exam less 1 mark to pass, ask for 1 extra mark, kesian la ... satu markah lagi saja ...

Sure, it is not only limited to Malaysia and I'm sure other countries face the same issue. But Malaysia is truly in a class of its own on this when compared to nations around the same level.

Both the quarter and annual reports don't mention any potential rights issue. From the annual report:

- As at 31 Dec 2020, AA has secured loans of RM300m (Sabah), private placements of RM336m
- Applying for RM1b Danajamin loan and proposed issuance of debt instrument to raise RM1b.

Add those together it would already meet the RM2.5b target.

Flash: AirAsia Group 1Q net loss narrows to RM767m from RM804m net loss a year earlier.

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