Hainan Airlines shares are trading around 10% down on the last closing price after a six-month trading halt was lifted on 20 July.
Share price data shows that the Shanghai Stock Exchange listed stock opened around CNY2.91 ($0.43), down from the CNY3.25 closing price when the shares entered a trading halt on 10 January.
The halt was called pending an announcement on a major asset reorganisation. In March, it revealed plans to take controlling stakes in seven aviation-related businesses from the airline’s parent company HNA Group.
The stakes are in West Air, Guilin Airlines, HNA Aviation Technology, Hainan Tianyu Flight Training, Haihang Hotel Holding, SR Technics, and an unidentified overseas hotel operator.
It subsequently announced a CNY7 billion private share placement to 10 investors to help fund the transaction. Singapore sovereign wealth fund Temasek Holdings was the only investor identified by the airline.
It appears that the transactions are yet to be completed, and Hainan has warned investors to take caution when investing and watch for upcoming announcements.
The asset restructuring is in the context of a wider restructuring by HNA Group, which has been under pressure to meet interest payments on its large pile of debt, amassed during a major acquisition binge in recent years.
Despite that uncertainty, Hainan Airlines reported a 51% boost in operating profit during the quarter ended 31 March to CNY1.69 billion. However its cash and cash equivalents at the end of the period fell to CNY20.9 billion, down from CNY28.1 billion a year ago.
Source: Cirium Dashboard
