Multi leg flights on budget airlines, great idea

The airline industry is so dynamic that airlines need to keep coming up with innovative ways to make money to stay in business. This is especially true in the case of budget carriers or Low Cost Airlines (LCCs). One key characteristic of LCCs has been their point-to-point service, moving away from a hub-and-spoke model to save costs. But a new trend, in a totally opposite direction, has recently emerged, as first pointed out by the ITA Travel blog.
LCCs have started serving multiple P2P sections, effectively like a hub and spoke model. Tiger Airways customers can book two flights in one booking using their Flight Combo feature, effectively being able to travel from Chennai to Perth via Singapore, or from Darwin to Hanoi via Singapore. Air Berlin in Europe allows similar flexibility to passengers, flying via Düsseldorf in Germany.

Tiger Airways route map
The latest kid on the block is Air Arabia, the extremely popular Sharjah, UAE based airline. As mentioned on Popagandhi, they have formed a joint-venture with Nepal’s Yeti Airlines to launch a new budget carrier flyyeti.com, offering destinations in Southeast Asia and even Hong Kong based out of Kathmandu. So you can fly from Yerevan, Armenia to Hong Kong via Sharjah and Kathmandu (I’ve been to Armenia, and trust me, it’s not easy to get to that place, and you don’t want to fly Aeroflot). So why does this make sense for LCCs?