Caixin
Jan 17, 2023 04:51 PM
BUSINESS

Shanghai Airport Operator Buys $251 Million Stake in Duty-Free Shops

What’s new: The operator of Shanghai’s two major airports has announced that it will invest 1.7 billion yuan ($251 million) in two firms that operate online and offline duty-free shops.

Shanghai International Airport Co. Ltd. (600009.SH), the listed platform of parent company Shanghai Airport Group, announced Friday that it will fund 1.4 billion yuan and the rest will come from the investment arm of the Group — Shanghai Airport Investment Co. Ltd.

The two entities will buy a 12.48% stake in CDF-Sunrise, an e-commerce duty-free platform, and a 32% stake in Uni-Champion, a Hong Kong firm that owns a 15.68% stake in four firms that operate duty-free shops in the airports of Beijing and Shanghai, as well as in the downtown areas of the two cities.

The context: Before the deal, Shanghai Airport Group’s involvement in the duty-free business was through charging rent to duty-free shops in the Pudong and Hongqiao airports. By owning stakes in CDF-Sunrise and Uni-Champion, the airport operator has widened its sources of revenue by receiving dividends from the two companies.

In the first half year of 2022, CDF-Sunrise reported 143 million yuan in net profit attributable to shareholders and Uni-Champion reported a net profit of 220 million yuan.

Because they do business in major inbound and outbound transportation hubs, the duty-fee shops in Shanghai’s two airports will benefit from China’s border reopening, which will contribute to the airport operator’s revenue growth, according to a Monday note from brokerage Cinda Securities Co. Ltd.

Related: Cover Story: China’s International Air Travel Resumes, But Covid Turbulence to Delay Takeoff

Quick Takes are condensed versions of China-related stories for fast news you can use.

Contact reporter Guo Yingzhe (yingzheguo@caixin.com) and editor Bertrand Teo (bertrandteo@caixin.com)

Download our app to receive breaking news alerts and read the news on the go.

Get our weekly free Must-Read newsletter.

Share this article
Open WeChat and scan the QR code
NEWSLETTERS
Get our CX Daily, weekly Must-Read and China Green Bulletin newsletters delivered free to your inbox, bringing you China's top headlines.

We ‘ve added you to our subscriber list.

Manage subscription
PODCAST