KUALA LUMPUR – Shares linked to AirAsia fell sharply today, with AirAsia and Capital A Bhd among the three most actively traded counters, following reports of possible government involvement in the low-cost carrier’s domestic operations amid concerns over its financial position.
As at 4pm, AirAsia shares had fallen 13.5 sen, or 21.09%, to 50.5 sen, with 133.84 million shares changing hands, Bernama reported.
Capital A shares declined five sen, or 18.18%, to 22.5 sen, with 118.57 million shares traded.
Reuters reported yesterday that Putrajaya had asked Malaysia Airlines and Batik Air whether they could absorb AirAsia’s domestic market share as authorities monitor the financial health of the country’s largest low-cost carrier.
Citing people familiar with the matter, the news agency said the discussions had intensified in recent weeks as part of scenario planning involving the Finance Ministry and Malaysia Airports Holdings Bhd (MAHB).
Malaysia Airlines and Batik Air were reportedly willing to expand organically by taking on AirAsia’s routes and passengers, rather than acquire its entire business. However, one source said a large-scale takeover would depend on whether the airlines could also assume AirAsia’s aircraft leases.
AirAsia has said it accounts for about 40% of Malaysia’s overall aviation market and 60% of domestic flying.
Reuters also reported that the airline recorded a net loss of RM831 million for the quarter ended June 30, including RM331 million in foreign-exchange losses, while its current liabilities stood at RM18.4 billion.
The airline reportedly owes MAHB at least RM500 million for services including landing and parking fees, with the airport operator having granted repayment extensions.
AirAsia said earlier this month that it was seeking up to US$1 billion through international debt markets and RM700 million in local credit facilities, primarily to restructure or refinance debt and strengthen its balance sheet.
While two sources estimated that the airline needed at least US$3 billion in fresh capital, AirAsia said its financing targets were sufficient and that it had RM954 million in cash and bank balances as at June 30.
Reuters said other options under discussion included some form of government endorsement to support AirAsia’s efforts to raise fresh capital, although the nature of any potential support remained unclear.
The airline has also been cutting underperforming routes, returning 25 older aircraft to lessors and renegotiating vendor contracts to reduce costs.
Meanwhile, Bernama reported yesterday that Batik Air chief executive officer Datuk Chandran Rama Muthy said the airline could add aircraft within a short period to meet or help accommodate domestic market demand if required. – September 17, 2026