01 March 2010
KUALA LUMPUR: OSK Research Sdn Bhd has upgraded its forecast for AIRASIA BHD 's profit before tax by 45.2% to RM454.1 million in financial year ending December 2010 (FY10) in anticipation that the aviation firm would benefit from lower fuel cost.
In a note today, OSK analyst Ng Sem Guan said the research firm had revised downwards its jet fuel price assumption to US$85 from US$90 a barrel during the year given that crude oil rates had consolidated at around US$80 per barrel.
However, the anticipation of AirAsia operating more new aircrafts in the next few years has raised concerns on the firm's balance sheet profile.
"The huge amounts owed by its Thailand and Indonesia operations together with its significant unrecognised share of operating loss also worry us, especially, the impact of introducing FRS139 effective 1 Jan 2010," Ng said.
As such, OSK has only upgraded its recommendation for AirAsia shares to Neutral despite raising its target price by 31% to RM1.48 from RM1.13.
by Chong Jin Hun