BofA Securities has initiated coverage on GMR Airports with a buy rating and a target price of ₹128 per share, stating that the company is entering a phase of strong earnings visibility supported by robust travel demand, a favourable regulatory environment and meaningful upside from non-aero and real estate monetisation. The brokerage said GMR is positioned to benefit disproportionately from India’s structural aviation growth, reflected in rising passenger traffic, improving yields and expanding commercial income streams across its airport portfolio.
According to BofA Securities, valuations at around 15x adjusted EV/EBITDA appear attractive relative to the future earnings trajectory, especially as several catalysts could drive upward revisions to consensus estimates. These include the reopening of Pakistan’s airspace, which would improve flight economics; regulatory clarity on the hypothetical RAB decision; successful execution of non-aero and property-development strategies; and the eventual initiation of dividends as cash flows strengthen.
However, the brokerage also highlighted key risks to monitor. These include potential short-term disruption once Delhi’s second airport becomes operational, the possibility of a stricter regulatory stance during tariff resets, geopolitical uncertainties that could affect Delhi’s international traffic, and an already elevated balance sheet that limits financial flexibility.
Overall, BofA Securities sees a multi-year runway for growth as GMR benefits from scale, diversified revenue engines and favourable legal outcomes that could further accelerate profitability.
Disclaimer: The views and recommendations above are those of BofA Securities. Business Upturn does not endorse them. Please consult a financial advisor before making investment decisions.
