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Highlights

  • Regulator finds AIA overcharged airlines by up to NZD 227 million; pricing to be cut from July 2025.

  • Macquarie forecasts moderate near-term financial impact but maintains "outperform" rating with NZD 8.63 target.

  • AIA share price down over 7% in 2025 despite long-term strategic adjustments.

The share price of Auckland International Airport Ltd (ASX:AIA) has dropped more than 7% in 2025, but analysts say recent regulatory developments and subsequent pricing changes could reshape its financial outlook.

The New Zealand Commerce Commission (ComCom) has directed the country’s largest airport to reduce the fees it charges airlines, concluding that Auckland Airport had been overcharging. A comprehensive review of AIA’s returns revealed that the airport operator was earning NZD 150 million to NZD 227 million more than what is considered fair, based on its Weighted Average Cost of Capital (WACC).

In response, Auckland Airport will implement substantial cuts to aeronautical charges beginning 1 July 2025. These include:

  • NZD 1.08 reduction per passenger on regional flights

  • NZD 1.74 cut for domestic jet passengers

  • NZD 4.86 discount for international travelers

The changes will span across FY26 and FY27, with AIA voluntarily discounting its pricing schedule by an average of 11% per year to align with regulatory expectations.

Macquarie, a leading broker, analyzed the situation and believes the move demonstrates fiscal responsibility and transparency on AIA’s part. The broker acknowledged a modest earnings boost for FY26, followed by a slight dip in FY27. Nevertheless, it emphasised that these adjustments are manageable and should improve AIA's long-term positioning.

Macquarie revised its forecasts to factor in the linear price discounting, and maintained an "outperform" rating on AIA shares, with a 12-month price target of NZD 8.63. Given the current share price of NZD 7.76, the projection reflects a potential 11.21% upside.

Auckland Airport, a critical infrastructure asset in New Zealand, handled 21 million passenger movements in FY2019, which accounted for around 70% of the nation’s international arrivals. The company also manages around 1,300 hectares of land, supporting a wide array of commercial ventures including retail, duty-free outlets, hotels, warehouses, and offices.