thanks everyone for their input....
after trying a few solutions, i guess I shall adopt the below approach....

use XML::Parser::PerlSAX;
use XML::Handler::YAWriter;

my $xmlquery = qq(<AIRAVAALABILTY> <AIRAVL> <AIRAVL012U>01MAY</AIRAVL0
+12U> <AIRAVL0145>SIN</AIRAVL0145> <AIRAVL018B>HKG</AIRAVL018B> <AIRAV
+L007V>Y</AIRAVL007V> <AIRAVL012G></AIRAVL012G> </AIRAVL> </AIRAVAALAB
+ILTY>);

my $ya = new XML::Handler::YAWriter(
'Output' => new IO::File ( ">-" ),
'Pretty' => {
    'NoComments'=>1,
    'PrettyWhiteIndent'=>1,
    'NoWhiteSpace'=>1,
    'PrettyWhiteNewline'=>1,
} );

my $perlsax = new XML::Parser::PerlSAX( 'Handler' => $ya);
my $result = $perlsax->parse(Source => { Encoding => 'ISO-8859-1', Str
+ing => "$xmlquery" });

print qq($result);
[download]

which in turn prints out

<AIRAVAALABILTY>
  <AIRAVL>
    <AIRAVL012U>01MAY
    </AIRAVL012U>
    <AIRAVL0145>SIN
    </AIRAVL0145>
    <AIRAVL018B>HKG
    </AIRAVL018B>
    <AIRAVL007V>Y
    </AIRAVL007V>
    <AIRAVL012G>
    </AIRAVL012G>
  </AIRAVL>
</AIRAVAALABILTY>
[download]