2025-06-10-花旗集团-上海国际机场（600009）_上海国际机场（600009.SS）_模型更新_11页_302kb

Citigroup Research: Shanghai International Airport (SSE: 600009)

Key Recommendation

• Citigroup maintains a Sell rating on Shanghai International Airport (SHIA) due to ongoing challenges in its core business and valuation.

Reasons for Sell Rating

• Aeronautical Growth: While 1Q25 traffic normalized with 7.5% year-on-year passenger growth and 3.6% aircraft movements, domestic performance was weak (-1% YoY), and international traffic is recovering at 24% YoY but remains below pre-COVID levels.
• Non-Aeronautical Recovery: Non-aero businesses underperform; duty-free contract revenue was -32% YoY in 2024 and -38% in Q4 2024, resulting in lower per-passenger consumption compared to pre-pandemic levels.
• Valuation Concerns: The stock trades at 32x 2025E P/E, which is expensive historically and not aligned with the perceived risk/reward, despite unchanged target price based on DCF model adjustments (-7%/-6% in 2025-26E earnings estimates).

Valuation Summary

• Target Price: RMB30.000, derived from a Discounted Cash Flow (DCF) model assuming a WACC of 9.8% (1.6% risk-free rate, 8.9% market-risk premium for China's domestic market, beta of 0.92, 2.4% post-tax cost of debt) and terminal growth rates of 3%/2%/1% for 2025/26/27.
• Current Metrics: Market Cap at RMB81.025B, expected 12-month total return of -6.4%, dividend yield of 1.4%.

Downside Risks

• 1. Stronger-than-expected passenger/fare growth.
• 2. Superior performance in non-aeronautical businesses.
• 3. Faster business consolidation or cost increases.
• 4. Lower capital expenditure than forecast.
• 5. Inability to meet the terminal growth assumptions in the DCF model.

Financial Performance Highlights

• Earnings Growth: 2025E net profit estimate at RMB2,256M (+51% YoY), with diluted EPS RMB0.907; however, 2024A net profit was RMB1,494M (+60% YoY but revised down per model update).
• Traffic and Revenue: Normalized in 1Q25 but domestic PAX/ATM debated (-1%/ +3.6%); non-aero business continues to lag, with duty-free revenue still significantly below historical averages.

Conclusion

Citigroup's analysis suggests SHIA's stock is overvalued relative to its growth outlook and historical performance, with low upside potential despite cautious revenue normalization. The recommendation emphasizes risks in the aeronautical and non-aeronautical segments.