With tourist boom, Thailand faces challenge in expanding its airports

Published on : Friday, June 30, 2017

Thailand airportsTourism in Thailand comes with a big challenge for the head of state-run Airports of Thailand Pcl: expanding passenger capacity in Bangkok by about the size of South Korea’s population.

 
The company is planning for 90 million passengers annually at the city’s main Suvarnabhumi Airport by 2022 and 40 million at Bangkok’s low-cost hub Don Mueang International Airport. The plan for Suvarnabhumi includes adding a public space to the existing terminal complex by 2020, a third runway the following year and a new international terminal by 2022.

 
Growth in tourism is a bright spot for Thailand’s economy, putting pressure on one of Asia’s biggest airport operators to ensure proper infrastructure. Airports of Thailand’s shares have climbed 18 percent this year, exceeding the benchmark SET index’s 3 percent advance.

 
According to Amnart Ngosawang, an analyst at KTB Securities (Thailand) Co in Bangkok, “The current share price offers very limited upside for investors. The fundamentals are strong, but valuation is quite expensive now.”

 
The goal of 90 million passengers at Suvarnabhumi in five years would double its current capacity. Changi Airport in Singapore has a capacity for about 60 million annually, while Beijing Capital International Airport can accommodate over 90 million. Both are expanding their airports.

 
In Thailand, airport expansion is especially important as tourism accounts for 18 percent of gross domestic product, with foreign visitors responsible for majority of the income.

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