Unlocking the Infrastructure Growth Story of Grupo Aeroportuario del Pacífico (PAC): A Deep Dive into Pricing Power, Capital Allocation, and Emerging Market Tailwinds

Mexico's aviation sector is undergoing a transformation, and Grupo Aeroportuario del Pacífico (PAC) is at the center of it. As the operator of 14 airports across the Pacific coast, including Guadalajara, Tijuana, and Puerto Vallarta, PAC has positioned itself to benefit from a confluence of long-term tailwinds: rising domestic air travel demand, regulatory support for infrastructure spending, and a strategic pivot toward non-aeronautical revenue streams. For investors seeking exposure to a high-growth emerging market sector with disciplined capital allocation, PAC presents a compelling case.

Infrastructure Tailwinds: A Master Plan for the Next Decade

PAC's 2025–2029 Master Development Program (MDP) is the cornerstone of its growth strategy. With a focus on expanding terminal capacity, modernizing cargo facilities, and enhancing non-commercial services, the MDP is backed by $3.375 billion in secured credit facilities and a robust $9.7 billion cash balance as of June 2025. The company's ability to recognize infrastructure-related revenues under IFRIC-12—accounting for 89.7% year-over-year growth in 2Q25—underscores its aggressive capital deployment.

This spending is not just about scale. Mexico's airports are evolving into economic hubs. For example, Tijuana's bonded warehouse operations and Guadalajara's new retail concessions are diversifying revenue beyond landing fees. These projects are supported by government-mandated tariff increases, which have already boosted passenger fee revenue by 22.5% in 2Q25. With international passenger traffic expected to rebound as new routes from carriers like Alaska Airlines and Volaris take off, PAC's infrastructure investments are primed to generate compounding returns.

Pricing Power in a Regulated Market

One of the most intriguing aspects of PAC's business is its pricing power within a regulated framework. While airport tariffs are subject to government approval, the 2025–2029 regulatory period granted PAC a 22.5% increase in passenger fees, justified by infrastructure costs and inflation. This ability to align pricing with capital spending is a rare advantage in emerging markets, where regulatory uncertainty often limits margin expansion.

Moreover, the depreciation of the Mexican peso has acted as a tailwind. Aeronautical service revenues in Mexican airports grew 20.8% year-over-year, driven by higher fees and the peso's 12% decline against the U.S. dollar in 2025. This currency dynamic, combined with a 67.1% EBITDA margin (excluding IFRIC-12), positions PAC to outperform peers in volatile macro environments.

Financial Discipline: Balancing Growth and Liquidity

PAC's financials are a testament to disciplined capital management. Despite aggressive infrastructure spending, the company maintains a strong liquidity position with $9.7 billion in cash and a $3.4 billion refinancing facility secured in 2Q25. Its debt-to-equity ratio remains manageable, with net income growth of 15.7% in 1Q25 and comprehensive income rising 30% year-over-year.

The company's capital allocation strategy is equally noteworthy. While capex surged 89.7% in 2Q25, the majority of spending is directed toward high-ROI projects like Guadalajara's new terminal and Tijuana's cargo expansions. This focus on asset productivity—rather than speculative bets—reinforces PAC's sustainability as a long-term growth story.

The Bigger Picture: Mexico's Aviation Revolution

The broader context is equally favorable. Mexico's domestic air travel demand is growing at 6–8% annually, driven by low base rates and new routes. With Volaris, Alaska Airlines, and Avelo expanding their networks, PAC's airports are becoming critical nodes in regional connectivity. Additionally, the Jamaican airport segment, though smaller, is seeing similar dynamics, with tariff increases offsetting a 4.4% drop in passenger traffic.

Investment Implications

For investors, PAC offers a rare blend of high-growth infrastructure exposure and emerging market resilience. The company's ability to leverage regulatory tailwinds, optimize pricing, and allocate capital efficiently makes it a standout in a sector often plagued by underperformance. While risks like currency volatility and geopolitical shifts exist, PAC's hedging strategies and diversified revenue streams mitigate these concerns.

Key metrics to monitor include:
- Passenger traffic trends in key airports (e.g., Guadalajara, Tijuana).
- Non-aeronautical revenue growth, particularly in cargo and retail.
- Debt refinancing costs as interest rates stabilize.

In a world where infrastructure equities are undervalued relative to their long-term potential, PAC is a prime candidate for a multi-year investment thesis. For those willing to ride the wave of Mexico's aviation renaissance, the runway is long—and the returns could be equally expansive.