Impact Analysis of Xiamen Airports' New Airport Commissioning on Company Valuation

Now I will write a complete analysis report for you.

According to the latest construction updates, the Xiamen Xiang’an International Airport project is progressing as planned, and it is expected to be basically completed by the end of 2025 and officially open to traffic by the end of 2026 [1][2]. The airport is located at the southeast end of Dadeng Island, Xiang’an District, Xiamen City, Fujian Province, with a planned core area of 21.37 square kilometers and will be constructed in three phases. The total investment of the project is 55.574 billion yuan, with the first phase constructing two runways and a 550,000-square-meter T1 terminal, designed to handle 45 million passengers, 750,000 tons of cargo and mail, and 380,000 aircraft takeoffs and landings annually [1][3].

Xiamen Xiang’an International Airport is positioned as an important international airport, a regional hub airport, and a gateway airport for cross-Strait exchanges in the Taiwan Strait. Its flight zone meets the highest international standard 4F, which can satisfy the takeoff and landing needs of large aircraft such as Airbus A380 and Boeing 747 [1].

According to the planning and deployment of Xiamen City, after the Xiamen Xiang’an International Airport is officially put into operation at the end of 2026, the Xiamen Gaoqi International Airport operated by Xiamen Airports will be closed simultaneously [4]. Gaoqi Airport was completed and opened to traffic in 1983, and currently has only one runway, which is operating at full capacity. In 2024, Xiamen Gaoqi Airport’s passenger throughput was 27.907 million, ranking 17th among domestic airports [5]. As the airport’s capacity is saturated and it is difficult to expand, the overall relocation to the new airport is an inevitable choice for urban development.

To actively respond to the uncertainty in the continuous operation of the listed company’s main airport business after the relocation of Gaoqi Airport, Xiamen Airports issued a prompt announcement on planning equity acquisition and related transactions in December 2024. The company is planning to acquire 100% equity of Zhaoxiang Technology, a wholly-owned subsidiary of its controlling shareholder Xiangye Group, with its own funds [4].

As an important airport operation target in the A-share market, Xiamen Airports (600897.SS) has shown sound financial fundamentals:

In the first three quarters of 2024, the company achieved operating revenue of 1.523 billion yuan, a year-on-year increase of 7.21%; the net profit attributable to shareholders of the listed company was 384 million yuan, a year-on-year increase of 3.53% [4]. The company has a conservative financial attitude and low debt risk, reflecting a sound management style [6].

The company’s current business is mainly divided into two categories [4]:

• Aeronautical Business
  : Basic services directly related to aircraft, passenger and cargo services, including takeoff and landing fees, parking fees, jet bridge fees, etc.
• Non-Aeronautical Business
  : Extended commercial services, including office rental, check-in counter rental, parking lot business, advertising business, etc.

In recent years, the proportion of non-aeronautical business has continued to increase, becoming an important profit source and performance stabilizer for the company.

• Business Continuity Risk
  : After the closure of Gaoqi Airport, the company needs time to adapt to the new airport’s operation mode, and there may be business connection problems during this period.
• Passenger Flow Transfer Risk
  : The new airport is far from the urban area, which may cause inconvenience to some passengers in the early stage and affect short-term passenger flow.
• Impact of Construction Period Investment
  : During the construction of the new airport, the company may face capital expenditure pressure and declining operational efficiency.

However, through the strategic move of acquiring Zhaoxiang Technology, the company has effectively hedged against the above risk exposures.

• Significant Capacity Upgrade
  : The new airport is designed to handle 45 million passengers annually, which is more than 1.6 times that of the existing Gaoqi Airport, providing huge growth space for the company [1][3].
• Enhanced Aviation Hub Status
  : The new airport is positioned as a regional hub airport and a gateway for cross-Strait exchanges, which will attract more airlines to add routes and improve the overall operational efficiency of the airport.
• Enhanced Cargo Capacity
  : The 750,000-ton cargo and mail throughput will significantly enhance the competitiveness of air cargo business, complementing the strong foreign trade industry foundation in Xiamen and surrounding areas.
• Driven by Airport Economic Zone
  : After the airport is completed, it will play an innovative enabling role as an aviation hub, build an “Aviation +” international multimodal transport integrated logistics hub, expand air passenger and cargo service capabilities, and enhance the development level of airport-related industries [1].

Founded in 1996, Zhaoxiang Technology is a national high-tech enterprise, a national science and reform demonstration enterprise, a Fujian provincial enterprise technology center, and a key enterprise in Xiamen’s future industries. Its core business focuses on civil aviation informatization, smart airport system construction and operation, and building intelligent business. Its civil aviation products cover civil aviation operation, civil aviation logistics, civil aviation safety, and civil aviation intelligent management.

After the completion of this acquisition, the business of the listed company will extend to the field of civil aviation intelligence, which has the following strategic values:

• Reduce Dependence on Single Airport Business
  : Improve risk resistance through business diversification.
• Enter New Productivity Track
  : Smart airport is the core direction of digital transformation in the civil aviation industry, with broad market space.
• Leverage Synergy Effects
  : Zhaoxiang Technology and the main airport business form upstream and downstream synergy to enhance overall competitiveness.

According to the analysis of professional valuation models, the current stock price of Xiamen Airports is $17.20, and the intrinsic value under various scenarios is as follows [7]:

• Revenue Growth Rate: 11.3% (based on historical 5-year CAGR)
• EBITDA Margin: 35.6%
• Terminal Growth Rate: 2.5%
• Weighted Average Cost of Capital (WACC):7.3%

• The conservative scenario uses a zero-growth assumption to stress-test the valuation bottom line.
• The optimistic scenario assumes a revenue growth of14.3% and an EBITDA margin of37.4%.

The commissioning of the new airport and business transformation will provide the following support for the company’s valuation:

###1. Core Investment Logic

Xiamen Airports is facing a critical juncture of business transformation. The commissioning of the new airport will bring significant scale expansion opportunities for the company, while the acquisition of Zhaoxiang Technology has achieved strategic upgrading from a traditional airport operator to an integrated smart airport service provider. The valuation level corresponding to the current stock price has a high margin of safety, and the DCF probability-weighted valuation implies an upside potential of approximately 300% [7].

###2. Key Tracking Indicators

Investors should focus on the following progress:

• New Airport Construction Progress
  : Achievement of the goal of being basically completed by the end of 2025.
• Relocation Plan
  : Connection arrangements between the closure of Gaoqi Airport and the operation of the new airport.
• Integration of Zhaoxiang Technology
  : Release of business synergy effects after the completion of the acquisition.
• Passenger and Cargo Data
  : Actual operational performance after the new airport is put into operation.

###3. Risk Warnings

• Construction Progress Risk
  : The new airport’s construction progress being behind schedule may affect the relocation timetable.
• Passenger Flow Below Expectations
  : The passenger flow in the early stage of the new airport’s operation may be lower than the designed capacity.
• Integration Risk
  : There is uncertainty in the business integration of Zhaoxiang Technology.
• Macroeconomic Fluctuations
  : Air travel demand is affected by economic cycles.

The commissioning of Xiamen Xiang’an International Airport will have a profound and positive impact on Xiamen Airports. In the short term, the company faces challenges in business transition, but through the strategic move of acquiring Zhaoxiang Technology, it has effectively resolved the business continuity risk after the closure of Gaoqi Airport. In the medium and long term, the capacity expansion brought by the new airport and the business transformation to the smart airport field will open up new growth space for the company. Considering the company’s sound financial fundamentals, the scale expansion opportunities brought by the new airport’s commissioning, the strategic value of business diversification transformation, and the margin of safety implied by the current valuation level, Xiamen Airports has good medium and long-term investment value. DCF valuation shows that the company’s intrinsic value is significantly higher than its current market capitalization, and the opportunity for valuation re-rating is worth looking forward to [7].

[1] Xiamen Xiang’an International Airport Construction Makes Multiple Breakthroughs to Rush for Completion Target in 2025 (http://xm.fjsen.com/2025-08/07/content_32011820.htm)

[2] Xiamen Xiang’an International Airport Project Construction Enters Countdown (http://www.news.cn/photo/20250617/d787dcb9a26e4395a376e6fdb2dc7270/c.html)

[3] By the End of This Month, Xiamen Xiang’an International Airport Will Be Basically Completed! (https://view.inews.qq.com/a/20251223A03HXK00)

[4] 600897, Planning Important Acquisition! Stock Price Rises by Limit for Two Consecutive Days in Advance - Securities Times (https://www.stcn.com/article/detail/3532829.html)

[5] What Changes Will Airport Relocation Bring to Xiamen? (http://www.360doc.com/content/25/0609/19/40066813_1155179045.shtml)

[6] Jinling API Financial Analysis Data

[7] Jinling API DCF Valuation Data