AirAsia : To benefit from MAHB’s incentive scheme

Underperform

News Update

- AirAsia will benefit from the new incentive package called Airline Recovery Programme introduced by Malaysia Airports that will take effect from 1 Jan 2010, for three years.

- AirAsia will fall under the “existing airlines” category that will be entitled to RM10/pax incentive for first 10% growth, RM12.50/pax for next 8% growth and RM15/pax for growth above 18%, using 2008 as base year.

- Based on our estimates, AirAsia is poised to receive RM7.2m and RM4m incentive payments from Malaysia Airports that will boost its FY12/10-11 net profits by 2-3%.

- Forecasts maintained, pending guidance from AirAsia on its estimates on quantum of incentive payments.

- Maintain Underperform. Fair value is RM1.23.