MALAYSIA: Transmile shares stumble on report

A steady rebound in shares of Malaysia’s Transmile Group Bhd was interrupted by a research report that questioned the number of planes it has, a claim the air transport firm said was inaccurate, the Business Times reported. The stock, which last month fell to its lowest in two years on news of accounting irregularities recently, […]


A steady rebound in shares of Malaysia’s Transmile Group Bhd was interrupted by a research report that questioned the number of planes it has, a claim the air transport firm said was inaccurate, the Business Times reported.

The stock, which last month fell to its lowest in two years on news of accounting irregularities recently, was down by as much as 13 percent at the end of May.

Dealers said the fall was sparked by a report from Macquarie Research, which said the actual number of aircraft Transmile operates does not tally with figures in its 2005 annual report. Transmile said the report was not accurate.

According to Macquarie Research, the actual number of aircraft operated by Transmile could well be eight B727s and not 10 as reported in its annual report. It downgraded the stock to “underperform” from “outperform”, and cut its target price to RM6.85 from RM14.60.

“We downgrade our rating on Transmile … following a search of online aircraft registries that raised our concerns about the actual number of aircraft being operated by the company,” Macquarie Research wrote in a note to investors.

Transmile said in its 2005 annual report that it has 10 B727s, four B737s and four MD-11s.