Shares of budget carrier AirAsia fell to a six-month low as the Central Bureau of Investigation has registered a case against Air Asia Group CEO Tony Fernandes and others over alleged violation of norms for getting international flying licences.

The case relates to alleged violation of norms by the directors of the aviation company for relaxation of 5/20 rules in the aviation sector to get licences for international operations, as well as violation of the Foreign Investment Promotion Board (FIPB) rules. The 5/20 rule means that a company needs five years of experience and 20 aircraft to become eligible for the licence.

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Officers raided AirAsia offices in major Indian cities as part of its investigation. However, AirAsia has denied any wrongdoing.

AirAsia shares fell as much as 6.3 per cent to 3.10 ringgit (78 cents) in Kuala Lumpur, their lowest level since late November, before edging up. The investigation is a blow in a market that AirAsia had singled out as a major destination to expand.

Corrine Png, CEO of Asian transport equity consultancy Crucial Perspective, told AFP investors might be concerned as “investigations are likely to impede” plans by AirAsia India to expand out of the domestic market next year.

“International flights will be more lucrative for AirAsia India than domestic operations where competition is stiff.” But she also noted that the impact on AirAsia as a whole was likely to be minor as the India branch was only a small part of the company.

AirAsia and its local joint venture partner Tata Sons had launched domestic flight operations in India in 2014 by offering eye-catching promotional fares to lure budget travellers. Fernandes, a millionaire ex-music executive, has styled himself as Asia’s answer to British tycoon Richard Branson.

The company ran into trouble this month when Air Asia India’s CEO Amar Abrol stepped down, citing personal reasons.

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