Wednesday, September 30, 2020

AOT’s helping hand to King Power 'will cost billions'

Aug 05. 2020
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By The Nation

Airports of Thailand (AOT) stands to lose more than Bt133 billion from its decision to change the minimum guaranteed payment method to help duty-free giant King Power amid the Covid-19 crisis, a stock analyst at Kasikorn Securities said on Tuesday (August 4).

AOT had informed the Stock Exchange of Thailand (SET) that it was taking the following steps to help King Power Duty Free and King Power Suvarnabhumi:

• Holding off the renovation of duty free areas until March 31, 2022;

• Changing the minimum guaranteed payment method to base it on the number of passengers at Suvarnabhumi Airport, which is far lower than the number estimated by the duty-free giant when it bid for the project.

An analyst at Kasikorn Securities said AOT was wrong in changing the minimum guaranteed payment without discussing it with shareholders first, because now it stands to lose Bt133.8 billion, which will bring its 2022 net profits down by 5.3 per cent.

“AOT should come up with better ways to ease King Power’s pressure from the Covid-19 pandemic,” he said.

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