Ventura Securities Bullish On Adani's Airport Business, Sees Revenue Rising 25.1% CAGR By FY27

Adani Enterprises Ltd., through its subsidiary Adani Airport Holdings Ltd., stands at a pivotal juncture, with its substantial airport operations in India positioning it for explosive growth, according to a note released by Ventura Securities Ltd.

With air passenger traffic and non-passenger revenue streams driving growth, the airports arm of Adani Group is expected to increase its overall revenue at a compounded annual growth rate of 25.1% to Rs 15,487 crore by fiscal 2027, it said.

The earnings before interest, taxes, depreciation, and amortisation is expected to grow even faster, at a CAGR of 46.7%, while Ebitda margins are forecast to expand by 1,885 basis points to 51.3%, driven by better space utilisation and increased revenue from non-aero segments, the note added.

As the country’s largest private airport operator, the company is set to capitalise on the rising demand for air travel and expanding non-passenger revenue streams, the brokerage said.

Currently, Adani Group operates eight airports across India, holding a significant market share of approximately 23% in passenger traffic and 33% in air cargo.

The company’s growth trajectory is supported by long-term concession agreements, with six of its airports having concession lifespans of 50 years, Ventura said.

With the aviation market in India still in the early stages of its growth potential, Adani Group's airport business is strategically positioned to capitalise on both passenger traffic growth and an expanding portfolio of non-passenger revenue opportunities, according to Ventura.

India's per capita air travel is significantly lower compared to global counterparts — just 0.2 trips per capita, compared to 2.1 in the United States — which presents a substantial growth opportunity in the coming years, it noted.

Ventura forecasts passenger volumes to grow at a compounded annual growth rate of 16.7%, reaching 140.7 million by fiscal 2027, aided by initiatives such as the UDAAN scheme and improvements in tourism infrastructure.

Additionally, the conglomerate's airport business is expected to benefit from the expected privatisation of airports, Ventura said. Under the National Monetisation Pipeline, over 25 major airports are expected to be privatised, after the success of 2019 auctions, it stated.

Another key driver for the growth will be the acceleration in non-passenger revenue model, with projected volumes growing at a robust CAGR of 24% to reach 422.1 million by fiscal 2027, according to Ventura.

Non-passenger revenues include a variety of services such as duty-free shopping, food and beverage, parking, lounges, and advertising.

Furthermore, the company’s city-side development or CSD plans — including 150 million square feet of space — will unlock additional monetisation potential, as per the note. Phase 1 of the CSD project alone is expected to span 20 million square feet, it added.

Beyond the immediate expansion of passenger and non-passenger revenue, key macro trends such as the expansion of regional connectivity under the UDAAN scheme, which connects underserved areas, will further boost air traffic. With non-aero spend per passenger still trailing global averages, there is significant room for growth in this area, the report said.

Adani Group is also poised to benefit from the Navi Mumbai International Airport, presently under construction, as it will add a massive capacity of 90 million passengers upon completion. "The phase-1 (20 million passengers) set to open by March 2025," Ventura pointed out.

Adani Airports Holdings owns 74% stake in Navi Mumbai International Airport Ltd, which is the special-purpose vehicle formed with the City and Industrial Development Corporation—the government's city planning agency.

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