Flughafen Zürich : Noida dreams; Zurich reality
Flughafen Zürich is a high-quality airport operator with a solid regulated base in Zurich Airport (c.40% of total EBIT). While traffic growth remains strong, the upcoming regulatory reset is set to bring ROIC at the regulated scope back toward the 5.5-6.5% allowed range and result in tariff cuts c.10% (ODDO BHFe). Commercial upside is constrained by near-term construction works while uncertainty about growth in retail spend per passenger remains. The international portfolio offers scale and optionality, yet execution, and regulatory risks remain high. With limited growth on cash flow generation, and more attractive names in the sector we see the valuation as stretched, therefore we initiate coverage with an Underperform rating and a CHF 212 target price.Flughafen Zuerich is engaged in the operation of Zurich Airport, providing access to international, national and regional transport networks. Co.'s segments include: Aviation, which provides services related to flight operations; PRM, which provides support for passengers with reduced mobility; User Fees, which provides, among others check-in areas and facilities, and the related services and fees; Security, which include services related to air security as well as the facilities and services provided; and non-regulated business, which encompasses all activities relating to the development, marketing and operation of the commercial infrastructure at Zurich Airport.
Oddo Securities provides securities brokerage and research services. The company offers equity, economic, and derivatives research and credit analysis services. It focuses on insurance, automotive, building materials, pharmaceuticals, telecommunications, information technology, and agri-food industries.
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