Airports of Thailand Pcl (AOT TB)

Incorporating PSC Increase in the Estimates

Although we have included a PSC increase of 100 baht for both international and domestic passengers, which raises our profit forecast and target price to 32 baht, AOT's valuation still appears expensive at a PE of 29 times in FY26F compared to an average profit growth of only 12% in FY26-28F. Therefore, we maintain our "Sell" recommendation.

Target Price Raised to 32 Baht, Maintain "Sell" Recommendation 

We have raised AOT's profit forecasts for 2026-27F by 24-38% and adjusted the target price (base year FY26F) to 32 baht/share (from 24 baht), reflecting the 100 baht increase in passenger service charge (PSC) for both international and domestic passengers. However, we maintain a "Sell" recommendation on AOT due to 1) a 42% recovery in the stock price from this year's low likely already reflecting the good news, 2) concerns about the slow recovery of foreign tourists to Thailand with expected growth of only 3% y-y in 2026-27F (-6% y-y in 2025F), 3) uncertainty over King Power’s duty-free contract adjustment and our expectation of a 22% reduction in King Power's minimum guaranteed revenue in FY26F (see AOT analysis "Possible Contract Amendment" June 18, 2025), and 4) despite including the PSC increase, AOT's valuation still looks expensive at a PE of 29 times in FY26F compared to competitors at 23 times 

Possible 100 Baht Increase in PSC

Although the PSC increase has not been finalized because AOT is still in the study process, expected to be completed by next month before discussions with the Civil Aviation Authority of Thailand (CAAT) and submitting the adjusted PSC to the Civil Aviation Board for approval, we have evaluated according to CAAT's recommendation assuming the PSC will increase by 100 baht to 830 baht for international passengers and 230 baht for domestic passengers. Since AOT must announce the new PSC at least four months before it takes effect, we assume the new PSC will be effective from 3QFY26F onwards (AOT’s fiscal year ends in September).

Expected Average Profit Growth of 12% in FY26-28F

After an 8% y-y profit decline in FY25F (compared to a 1% decline in 9M25) due to reduced duty-free concession revenue after AOT reclaimed some commercial space from King Power, we expect AOT’s profit to recover with growth of 8/21/8% y-y in FY26-28F. Although we expect duty-free concession revenue to decline again in FY26F due to contract adjustments reducing King Power’s minimum guaranteed revenue, this should be offset by stronger passenger revenue supported by international passenger growth of 3–5% per year in 2026-28F and the 100 baht PSC increase effective from 3QFY26F onwards.

COMPANY VALUATION

COMPANY INFORMATION

Sources: Bloomberg, Company data, Thanachart estimates 
 

Ex 10: AOT’s Existing Capacity

Sources: Company data, Thanachart estimates
 

COMPANY DESCRIPTION

Airports of Thailand Public Company Limited is a state enterprise and the leading airport management business in Thailand. Currently, AOT operates six international airports: Don Mueang Airport, Phuket Airport, Chiang Mai Airport, Hat Yai Airport, Chiang Rai Airport, and Suvarnabhumi Airport. All airports provide both domestic and international flight services. Passenger service charges (PSC) and aircraft landing and parking fees account for approximately 50% of the company’s total revenue, while the remaining revenue comes from non-aviation businesses such as concession and service fees.
 

FINANCIAL DATA