2025-06-11-花旗集团-阿特拉斯动脉集团（ALX）_阿特拉斯动脉集团（ALX.AX）_今日禁售前会议要点_11页_225kb

Summary of Citi Research Report on Atlas Arteria Group (ALX.AX)

• Key Takeaways from Pre-Blackout Meeting:

  • Strong traffic growth in France and the US, with approximately 6% growth at Dulles, indicating a positive market backdrop.
  • Progress on the Dulles Greenway: Supreme Court hearing held on the 2024 rate case application for toll increases; expectation of a 2025 rate case submission, advancing toward distribution lock-up removal.
  • Growth opportunities in France: Eiffage bidding for additional road projects, such as A154, following the A412 win, highlighting future expansion potential.
  • Debt costs in France may increase marginally due to lower current debt costs.

• Valuation:

  • Target price of A$5.70 based on a sum-of-the-parts DCF model, discounting cash flows at WACC ranging from 6.6% to 8.9%, with assumptions of 3% risk-free rate for Europe and 4% for the US, and risk premiums of 5-6%. Group valuation net of corporate debt and overheads is A$7.675 billion.

• Risks:

  • Near-term risks: Additional income tax in France for APRR, unfavourable FX movements impacting A$ distributions, higher bond yields and interest rates affecting cash flows and valuations.
  • Medium-term risks: Inability to replace the APRR concession upon expiry in November 2035, additional taxes in France, and ongoing traffic weakness on toll roads.

• Catalysts and Recommendations:

  • Analysts Maintain a "Buy" rating based on solid 1Q25 performance, high distribution yield, and new payout policy ensuring DPS growth medium-term.
  • Expected returns: Price upside to A$5.70, expected dividend yield 7.6%, total return 15.3%, with risks of price volatility due to catalysts like legal outcomes and economic factors.

• Additional Context:

  • The report emphasizes bottom-up drivers for performance and is part of Citi's coverage of infrastructure stocks. Disclosure includes conflicts of interest and standard research practices.