Capital A Eyes Hong Kong IPO Amid Financial Restructuring

Capital A, parent of low-cost airline AirAsia, is exploring a listing on the Hong Kong Stock Exchange to access broader global capital markets. The move follows its ongoing recovery from financial distress after pandemic-era travel restrictions severely impacted operations.

The Malaysia-listed firm was designated as financially distressed in 2022 but expects to return to profitability in 2025. CEO Tony Fernandes previously stated that Capital A must secure shareholder approval for its recovery plan and gain Malaysian High Court approval for a capital reduction. A key shareholder meeting is scheduled for May 7, with the company targeting a mid-2025 exit from distressed status.

The planned Hong Kong IPO would support the group’s strategy to consolidate its short and long-haul airline operations under the AirAsia brand by selling its aviation business to affiliate AirAsia X. Capital A reaffirmed it is on track to complete its restructuring and regularisation plan by June 2025, despite its auditors flagging material uncertainty in its FY2024 report regarding its ability to continue as a going concern. Fernandes clarified that this was a procedural audit note due to pending milestones, not a reflection of operational weakness.

Shares of Capital A rose 5.7% to 0.84 ringgit, hitting a near two-month high following the announcement. The company believes a Hong Kong listing is a logical next step to tap deeper global and Chinese investor bases, especially as Hong Kong’s equity markets show signs of revival.

Capital A is in advanced discussions to appoint an international investment bank to advise on the listing, with the process subject to internal and regulatory approvals.

This development marks a pivotal chapter for Capital A’s financial turnaround and regional expansion strategy.