KUALA LUMPUR, Dec 1 ― Capital A Bhd shares were slightly lower in early trade despite posting a sharply reduced net loss and more than double the revenue for the third quarter ended Sept 30, 2023 (3Q 2023) due to strong travel demand recovery.
At 10.38am, the counter eased half-a-sen to 86.5 sen, with 12.01 million units traded.
The airline group slashed its net loss to RM178.82 million for 3Q 2023 compared with RM901.31 million in the corresponding quarter a year ago, while revenue jumped to RM4.23 billion from RM1.96 billion in 3Q 2022.
Hong Leong Investment Bank said it has maintained a “buy” call on Capital A with a lower target price (TP) of RM1.40 as the group continues to show improving results, leveraging the improving air-travel outlook in the region. “We expect further potential upside to our TP should the PN17 regularisation plan be successfully executed,” it said in a note.
MIDF Research said the key catalyst for Capital A remains the potential for a faster-than-expected restoration of network and seat capacity to pre-Covid-19 levels.
Nevertheless, the research firm said that it has adjusted the airline company's 2023 earnings downward by 105 per cent and made marginal changes to 2024 and 2025 earnings by minus 6.0 per cent and minus 1.0 per cent, respectively, after factoring in increased fuel as well as maintenance and overhaul costs. ― Bernama
