Thailand’s Airports Operator to Turnaround with over 60 Million Intl Visitors in 2023, Analysts Eye Target Price at THB85

Thailand is expecting to welcome 7-10 million Chinese travellers in 2023 and Airports of Thailand Public Company Limited (SET: AOT) would be the forefront to greet visitors as they landed on Thai soil.

Analysts have a positive outlook on AOT’s operation this year, expecting more inbound travellers, especially after the reopening in China. Meanwhile, the company is expecting to join in a bidding for ground works at Suvarnabhumi Airport, through AOTGA, a subsidiary of AOT and Sky ICT Public Company Limited (SET: SKY).


Innovest X Securities (INVX) stated that the opening of the country has brought recovery in Thai tourism and with it, a surge in international passengers and in AOT’s operations. INVX expected AOT to report a core profit in 1QFY23 (October–December 2022) after 10 quarters of losses. Core earnings will continue to grow YoY and QoQ in 2Q-3QFY23, backed by more international passengers, the end of assistance for its concessionaires and resumption of the minimum guarantee per passenger scheme. AOT’s share price is 1% above pre-COVID-19 level, lagging other tourism plays (on average trading 37% above pre-COVID-19 level). INVX stated that it assigned a 3-month tactical call of Outperform with end-2023 DCF TP of Bt82.00 per share.


FSS International Investment Advisory (FSSIA) stated that in 2019, Chinese tourists accounted for about 30% of AOT’s passenger revenue. Therefore, the proposed reopening of China’s border on 8 Jan- 23 should directly benefit AOT, in its view. FSSIA noted that it currently projects 34 million tourist arrivals in 2023 (85% of pre-Covid) based on its assumption that Chinese tourist arrivals will recover to 60% of the pre-Covid level.

FSSIA added that its assumption may seem bullish, but it believed there is strong pent-up demand. For example, inbound Indian tourist arrivals took only six months to recover to 84% of the pre-Covid level in Nov-22 after Thailand’s full reopening in July-22.

As a result, FSSIA forecast an FY23 passenger volume of 110 million (61 million international and 49 million domestic), which exceeds AOT’s forecast of 96 million (49 million international and 47 million domestic).

FSSIA forecast core profit to hit THB13.2b in FY23 and jump to THB33.3b in FY24, exceeding AOT’s pre-Covid core profit of THB24.4b, as FSS believeed passenger volume should recover to the pre-Covid level by FY24. Furthermore, the MG on a per head basis for King Power’s contract is THB233 per passenger (starting from Apr-23), compared to an average of THB90 per passenger under the current revenue-sharing arrangement.

In addition, AOT trades at an attractive valuation of 32x FY24E (first normalised year) P/E, lower than its historical average of 47x. There is a potential upside from the three new airports (Udon Thani, Buriram and Krabi) which should be transferred from the Department of Airports to AOT by 1H23, subject to cabinet approval.

FSSIS maintained its “BUY” recommendation on AOT with a target price at Bt85.00 per share.