Airasia share price will start to move higher

-I expect Airasia share price will move higher due to stronger ringgit against dollar
when ringgit exchange rate hit to all time high (1USD=2.96RM) yesterday.
It will extract foreign institutional investor to start buying/accumulate thier stock. Please take note that 50% airasia share is owned by foreign investor.

-With stronger ringgit against dollar, it will reduce the cost of high fuel price as current fuel price is trade under dollar. Thus, reduce airasia operating cost and increase their profit margin.

Time to review Airasia stock

It is time again to review the outlook on airasia stock, with current market price of rm2.65 (yesterday closing price).

There is still potential for the share price to hit rm3.50 due to the following reasons: (i) the management is going to announce dividend payout policy by second quarter or third quarter of this year 2011(ii) airasia indonesia and thailand is going for individual country stock exchange for list in third quarter 2011(iii) airasia X which is long haul bugdet airline is going for listing either in US or Hong Kong this coming third quarter 2011.

Higher crude oil price (US110 as of yesterday closing price) does not have high impact on airasia overall revenue.This also create great market barrier for budget airline newcomer and reduce passenger load factor for full service airline as there are introducing/increasing fuel surcharge.More and more budget concern travellers and business owners will opt for budget airline while travelling oversea for businesses/vacations trips.

Current closing price of rm2.65 provide buying opportunity for those long term investor to accummulate this stock. I always believe that second quarter is the good buying session as traditionally most stock price are cheap and undervalue.