Equity Analysis /
Thailand

Asia Aviation PCL: Cash call comes through! Stock rally first, then take-off

  • Summary of the restructuring plan

  • What will TAA’s final shareholding structure look like?

  • Is it good or bad?

Bualuang Securities
28 April 2021

This report summarizes the restructuring plan for AAV and TAA. AAV will delist from the SET and TAA will increase capital and list on the SET in its place. Once the restructuring is complete, TAA will no longer have any liquidity issues and will benefit from lighter competition in the airline industry. Our AAV call shifts up to BUY!

Summary of the restructuring plan

COVID-19 has hit the airline industry hard, rising liquidity issues for Thai AirAsia (TAA), AAV’s operating company running the airline biz in Thailand, currently 55% owned by AAV and 45% by AirAsia Group Bhd (AAGB). To deal with the issue, AAV and TAA will restructure—AAV will delist from the SET and TAA will raise new capital, and list on the SET in its place. The restructuring plan includes issuing a Bt3.1bn convertible bond to “new investor”, converting TAA’s Bt3.9bn in liabilities owed to AAGB into TAA shares, transferring all AAV’s 55% holding in TAA to current AAV shareholders, and issuing new TAA shares (see details in Figure 1-3).