Last week AirAsia Group Bhd (KLSE: AAGB) went into free fall. The stock plunged 21% in a single session on 17 September to about 48 sen, its lowest level since 2022. It’s now down more than 70% year-to-date, the worst performer on the entire Bloomberg World Airlines Index. Capital A, its former parent and still a major shareholder, fell as much as 18% the same day. The trigger wasn’t an earnings miss. It was a Reuters report, dated 16 September, revealing that the Malaysian government, the Finance Ministry together with airport operator MAHB, had asked Malaysia Airlines and Batik Air whether they could absorb AirAsia’s domestic routes if needed. When the government starts modelling what happens if your airline can’t keep flying, the market reprices fast. So how bad is it? The balance sheet, the government’s move and crucially, AirAsia’s own rebuttal could shed some light. But to be frank, this is a real distress situation. It is also being reported with less precision than it deserves....