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Monday, December 1, 2014

AIRASIA - Now Flying is So much Cheaper !

Wow, Today KLCI Index flying down -42.62, closing at 1778.27, everyone should know its cause by the world crude oil price have fallen deeply to ranging 65-70 per barrel. So a quick update, which company will benefit the most in BURSA MALAYSIA?

 Yes, of course its AIRASIA (5099) !

A very simple explanation, lower oil price, cheaper cost for AIRASIA to fly and therefore earn more.

According to their boss :

Source: http://www.themalaysianinsider.com/business/article/airasia-x-mulls-london-route-again-as-oil-prices-fall

Lets look at how AIRASIA stock price doing now :

(Look at the volume ! BIG FUND start pushing it up ! Buy before too late~! (refer conclusion 5 at bottom)

After OPEC decide not to cut production, AIRASIA price jump immediately from 2.40 to 2.79 today. Up about 16% or 0.39 cent. Do you think its high now? For me, I see its still very low price. AIRASIA have consolidate for almost one year at range of 2.0-2.5, and finally with such a great news, it breakout 2.50 and looking forward higher price.

Why I think its not high? Lets look at other AIRLINE company from different region and you will know actually our AIRASIA still have so much room to fly.

China Eastern Airlines during September was about 2.4 and fly to 5.80 closing today. Its 140%+ increase !!

Another Airline :

Hainan Airlines fly from 1.8 straight to 3.15. 75% increase.


Amercican Airlines Group Inc fly from 23 to 49. About 100+ % !!

So lets come back to AIRASIA, did you see AIRASIA fly as much as other AIRLINE? We are way too far lagged which is a very good news for us !!

My logic analysis tells AIRASIA is good opportunity to buy at such a bad market because :

1. Oil price keep dropping, some expect to down further to 40-50.
2. Oil price drop will boost AIRASIA profits which their operating cost are almost 50% come from fuel.
3. AIRASIA price still very low compare to other region country.
4. Next quater we expecting AIRASIA will show a very good result due to lower cost, plus peak travel season during year end holiday ! (they like to give dividend at beginning of the year. (40% policy)
5. Important ! All oil and gas have fall more than 50% All fund manager have cut and out those counter and holding more cash position, I believe some already invested into AIRASIA !
6. Mas restructuring also benefit to AIRASIA ! 
7. All major research house from RHB, PUBLIC BANK, MAYBANK, KENANGA, AMBANK, HONG LEONG, ALLIANCE are giving buy call !

AIRASIA (5099) today 2.79. (1/12/2014)

My first TP 3.0, second TP 3.20 , Thirds 3.50.


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  2. It is good to know that flying is so much cheaper now. I liked all your post on trading analysis. I must say that you have a great experience in stock trading and analysis. Thanks!
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