Bamboo Airways Plans $100 Million Initial Public Offering

Bamboo Airways, the new favorite upstart airline from Vietnam, has already made plans to enter the stock market via an IPO despite launching less than a year ago.

Bamboo Airways Plans $100 Million Initial Public Offering
Bamboo Airways plans to raise $100 million USD to help pay for fleet expansion. Photo: Bamboo Airways

Who are Bamboo Airways?

Bamboo Airways is a new airline in Vietnam that took off in January 2019. They operate 10 leased aircraft (one Airbus A319, five A320s, and four A321neos) with a huge order for more aircraft on the way (30 Boeing 787-9s, two A330-200s, and 46 A321neos).

As reported by CH-Aviation, the airline also has four more A320-200s and the two A330s coming online before the end of this year.

The airline focuses on flying holidaymakers from Vietnamese cities to remote resort destinations that are owned by the airline’s parent organization, as well as domestic travel throughout the country. However, looking at their order book for future aircraft, it is obvious that they have far bigger ambitions too.

The airline wants to become the Vietnamese tourist airline of choice, even flying from Vietnam across to Europe and America.

The airline was launched with capital from investors to the tune of $56 million USD, and thus to fund further expansion, the airline will need to go public to raise more than double that initial amount.

Bamboo Airways First Flight
Humble beginnings as the first Bamboo Airways flight departs Ho Chi Minh City. Photo: Bamboo Airways

What is their new IPO?

According to an article published by Bloomberg, Bamboo Airways is ambitious enough to reach 30% market share (they believe they currently have 10% of Vietnam) by next year.

This ambition needs funding, and doing a public offering will allow the airline to actually reach that level of capacity and seats across their network, let alone the international plans outlined above.

“The fundraising will help us to expand our fleet as we want to take 30% of the domestic market next year,” Trinh Van Quyet, the Hanoi-based chairman of the startup carrier, said in a phone interview to Bloomberg. 

Likely most of this new funding will go to pay for their airline orders, with the remainder to be used for cash flow. Once the initial public offering (IPO) is complete the airline plans to open the shares up for public trading on a stock exchange but has yet chosen any in particular.

The airline has hopes to have 30 aircraft flying by the end of March 2020 and up to 100 aircraft by the end of the next five years in 2024, following permission from Vietnam’s Ministry of Transport in August for its adjusted operations.

Bamboo Airways 787
Bamboo Airways wants to use the 787-9 for long-haul operations but will need to find a way to pay for them. Photo: Bamboo Airways

And they will need to expand too, with Vietnam experiencing a tourism boom (both international and domestic). Air travel in the country is up 13% with 80 million domestic passengers last year, and 15.5. million international travelers on top of that.

Will you be buying shares in Bamboo Airways? What do you think? Let us know in the comments.