AirAsia PH unit’s planned IPO postponed to 2018

Budget carrier Philippines Air Asia’s plan to go public this year was pushed back to 2018.

This was revealed in a presentation to investors by operator Air Asia Berhad of Malaysia.

Philippines Air Asia was earlier planning to hold a $200- million initial public offering within the second half of 2017, Air Asia Group CEO Tony Fernandes said in June.

This was to partly fund its expansion and to launch new routes. AirAsia’s Philippine unit controls about 10 percent of the domestic market, which is still dominated by flag carrier Philippine Airlines and budget airline Cebu Pacific Air.

In its presentation to investors, Air Asia noted that Philippines Air Asia had continued to show “strong load factor and fares.” It said the carrier had added seven new routes and increased frequencies for certain destinations this year.

As such, it said the unit was “going ahead with listing plans in 2018 for further expansion to serve the strong travel demand.”

Philippines Air Asia is targeting revenue to hit P13 billion in 2017, up by about 20 percent from the P10.8 billion booked in 2016, its CEO Dexter Comendador said in a previous interview.

He said 2017 was poised to be the company’s “best year in our existence.” Philippines Air Asia started in 2012 and it has grown organically and via acquisitions.

It completed in 2015 an investment in and merger with Zest Airways, a move that gave it access to valuable slots in the Ninoy Aquino International Airport, the Philippines’s busiest air gateway.

Comendador said the domestic fleet would grow to 70 planes in 15 years, or by 2032. It had 15 Airbus A320s at the end of 2016.

He said the plan was also to increase its presence in Clark International Airport in Pampanga. After temporarily suspending its Clark service in 2013 to focus on Manila, Philippines Air Asia resumed flights from Clark to Kalibo on March 27, 2017.

The group is banking on its “One AirAsia” strategy, which will see all of its regional units consolidated under a single company, which will also be listed.

The group is planning to have a total of 500 planes by 2027.