- We cut our target price (TP) by 22% and downgrade our rating for ACV from OUTPERFORM to MARKET PERFORM. ACV's share price has declined 17% over the past five months, pressured by an ongoing Government investigation and Middle East-driven global aviation headwinds.

- Our lower TP reflects (1) a 6% reduction in our 2025F–38F core EBITDA (ex-TO/L) forecast and (2) methodological adjustments to our DCF — specifically, shifting the net debt from LQ to 2026F and increasing the D/(D+E) to 35% from 10% previously (see Valuation). 

- We revise our total passenger (pax) growth forecasts to 2%/11%/11% in 2026F/27F/28F (from 10%/9%/11% previously). The sharp downgrade in 2026F reflects (1) the removal of Phu Quoc International Airport (PQC)’s contribution and (2) our more cautious demand outlook following in-line 2M 2026 arrivals but intensifying risk from Middle East tensions.

- We push back LTH Phase 1’s projected operation timeline to H1 2027 (from mid-2026), while shifting Phase 2’s construction period by one year to 2028-2032 (from 2027-2031).

- As a result, our NPAT-MI forecasts change by +46%/-22%/-16% for 2026F/27F/28F, implying YoY growth of +4%/-52%/+52%, respectively. Nevertheless, our core EBITDA remains resilient with growth of 5%/18%/14% over the period. 

- Downside risks: Higher-than-expected bad debt provisions or capex; slower-than-expected airport capacity expansion; lower-than-expected pax numbers; dilution from the State's capital increase through State-invested assets injection; ACV’s investigation under central oversight, with limited public disclosure creating potential headline risk.

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