AirAsia rebounds 8pct from three-year low, Capital A follows

KUALA LUMPUR: AirAsia Group Bhd shares bounced off a more than three-year low today, snapping a five-day losing streak as the stock climbed as much as eight per cent before the midday break.

Sister firm Capital A Bhd also caught the upswing, rising more than six per cent, while renewed buying interest propelled AirAsia into Bursa Malaysia's most actively traded stocks.

AirAsia opened 2.5 sen, or 3.21 per cent, higher at 80.5 sen from Tuesday's close of 78 sen before climbing to an intraday high of 84.5 sen, up 6.5 sen or 8.33 per cent.

At market close, the budget airline group settled at 83.5 sen, up 5.5 sen or 7.05 per cent, valuing the company at RM2.81 billion. Year to date, the stock remains 53.35 per cent below the RM1.79 level at which it started the year.

Meanwhile, Capital A rose as much as two sen, or 6.25 per cent, to 34 sen before closing the day at at 33.5 sen, up 1.5 sen or 4.69 per cent, with about 9.82 million shares traded. At that price, the company was valued at around RM1.5 billion.

The stock remains down about 18.3 per cent year to date from 41 sen.

The rebound comes against a tougher backdrop for AirAsia Group, which reported a RM527 million net loss for the second quarter of financial year 2026 (Q2 FY26) as higher fuel costs and foreign exchange losses weighed on its bottom line.

Fuel expenses climbed after average fuel prices surged 66 per cent quarter on quarter, driven mainly by heightened geopolitical tensions in the Middle East.

Currency movements dealt another blow, with the group booking RM331 million in net foreign exchange losses as the ringgit, Thai baht, Indonesian rupiah and Philippine peso weakened against the US dollar.

Revenue stood at RM5.09 billion despite an 11 per cent reduction in capacity, as AirAsia prioritised yields over passenger volume.

The pressure from fuel costs and Middle East tensions has prompted the airline to rein in capacity and reassess parts of its network.

Reuters reported that AirAsia is cutting capacity and retiring older aircraft to keep costs in check.

The airline has also pushed back the launch of its Kuala Lumpur-Bahrain-London Gatwick service to March 2027 from August 2026, citing heightened tensions in the Middle East.

The share-price moves come months after a major restructuring redrew the lines between AirAsia Group and Capital A.

AirAsia X acquired Capital A's aviation business earlier this year, bringing the AirAsia-branded airlines under a single platform.

The exercise left Capital A as a non-airline investment holding group, with businesses spanning aviation services, logistics, digital and other ventures.