AirAsia KL Share Plummets 11% following the Airbus Bribery Scandal
AirAsia KL Share Plummets 11% following the Airbus Bribery Scandal
AirAsia KL Share Plummets 11% following the Airbus Bribery Scandal
3 ก.พ. 2563

Regarding to the report of Reuters, the share price of Malaysia’s AirAsia Group (AIRA.KL) and unit AirAsia X (AIRX.KL) has plunged 11% and 12% respectively on Monday due to the Britain’s Serious Fraud Office’s allegations for Airbus bribery to win AirAsia’s airplane purchasing.
The British prosecutors accused that Airbus has bribed for plane ordering and had a hidden payment as part of pattern of worldwide corruption.
The AirAsia shares dropped 11% to 1.27 ringgit which is the lowest since May 2016 and AirAsia X fell 12% to 11.5 ringgit to the all-time low of its share price.
However, AirAsia insisted that the airline never made a decision on purchasing that were premised on Airbus sponsorship, and that it would fully cooperate with the Malaysian Anti-Corruption Commission (MACC).  Malaysia’s Securities Commission will examine whether AirAsia broke securities laws.
Analysts point that AirAsia has been facing a slowdown in business since the coronavirus outbreak with harmed an air travel and was hit again by the bribery scandal.  
“Besides being embroiled in this corruption scandal, we expect a tough operating environment to persist over the medium term with maintenance cost remaining high … and concerns over the Wuhan virus outbreak which could derail propensity for air travel in the region,” Malaysia’s Kenanga Investment Bank wrote in a research note.
Securities have downgraded the AirAsia Stock to “SELL” from buy. “We choose the ‘sell first, ask questions later’ approach to avoid the uncertainty in association with the corruption investigation by MACC, where the impact on AirAsia could be significant in terms of corporate governance,”
Interestingly, whether the accusation would affect the AAV in market stock.  
 