The Malaysia-based group is also looking for more aircraft to meet strong demand in North Asia and elsewhere, the people said on the eve of Britain’s Farnborough Airshow.

Asia’s largest low-cost airline group, which already has affiliates across Southeast Asia, aims to form the venture with the backing of a Chinese state-owned enterprise to help capture traffic from fast-growing secondary and tertiary cities.

Co-founder and chief executive Tony Fernandes referred to the potential dual listing without naming a location and hinted at a potential new aircraft order in remarks posted on his Twitter account on Sunday.

“Looking at more ancillary (revenues), more capacity and dual listing,” he said.

The airline group is talking to Chinese banks and potential shareholders including China Everbright Bank, one source said.

Expansion into the world’s fastest growing aviation market comes as China edges toward overtaking mature Western air travel markets despite recent slowing economic growth.

It also comes as AirAsia rebounds from recent turbulence due to lower oil prices and as Fernandes and his partner put in additional investment and take greater control of the business.

Its stock price fell sharply last year amid negative reports about its finances, but has rallied sharply since then.

A Hong Kong listing could help to raise the company’s profile, coming on the heels of the flotation there of aviation lessor BOC Aviation, and allow it to raise capital.

‘Another Dubai’

Reporting a near six-fold jump in quarterly profit in May, Fernandes said demand from Chinese travellers had recovered.

The airline also sees broad demand in markets like Korea |and Japan and has said it is |bullish on India after the country recently eased regulations on |the growth of young airlines.

Fernandes has signalled he aims to make AirAsia a low-cost giant with one-stop connections mainly from its Malaysian base.

“It is a huge business opportunity (to) use low cost to build another Dubai,” a person involved in the plans said, referring to the leading Middle East transport hub.

In mid-June, former senior AirAsia executive Kathleen Tan, seen as one of Fernandes’ most trusted executives, re-joined the carrier to head its North Asia operations.

This included responsibility for building the airline’s market and brand in China, Hong Kong, Macao, Japan, South Korea and Taiwan.

China contributes nearly 40 per cent of the group’s revenues, but Fernandes said when appointing Tan that there “is still a lot to do in North Asia, …an important long-haul market”.

After a false start, the AirAsia Japan JV is expected to begin operations this half year.

The company’s longer-term goal is to have a JV in either Hong Kong or China, said another source familiar with the company’s thinking.

AirAsia has been adding more point-to-point services from Malaysia and Thailand to North Asia.

The goal is to use AirAsia’s short-haul and long-haul units to connect passengers from North Asia to Southeast Asia and Australia.

AirAsia operates over 220 flights daily to and from Kuala Lumpur, connecting to over 100 destinations in 24 countries.

It has, however, been in a spat with Malaysia Airports, operator of Kuala Lumpur International Airport, over the design of a budget terminal that began operations in 2014.

AirAsia group says it accounts for 97 per cent of operations at the terminal.