AirAsia IPO: sky's the limit?

Expectations running high despite record oil prices.

Asia's first budget airline, AirAsia Berhad is expected to begin roadshows for a $225 million to $270 million IPO next Monday following two weeks of pre-marketing. At first glance, timing of the Malaysian share sale could hardly seem worse with record oil prices taking a steep toll on global airline stocks.

European budget airline stocks such as Easyjet and Ryanair, for example, have seen their share prices collapse, with the former down 57% year-to-date and the latter 44%. Comparable US stocks have fared little better, though the grandaddy of the industry, Southwest Airlines, is down a more modest 14% thanks to a far-sighted hedging policy towards jet fuel, typically an...

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