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What’s driving Auckland International Airport Ltd’s share price higher?

Investing in companies that own critical infrastructure can be a great idea for defensive investors with a long-term focus.

Auckland International Airport Ltd (ASX: AIA) is one such company that has been generous to investors in the past with its share price rising approximately 200% in the last five years. Indeed, it still appears to be recording reasonable growth today.

The infrastructure group continued its impressive run this morning when it provided its monthly traffic numbers, reporting a 4.4% lift in domestic passengers and a 7.6% lift in international passengers during October 2015 (compared to October 2014). It said this growth was driven mostly by Asian routes which were up 17.8%, reflecting a powerful trend benefiting many major airports around the world.

Indeed, numerous airports are benefiting from booming tourism rates, especially from countries such as China. Sydney Airport Holdings Ltd (ASX: SYD) is also experiencing reasonable growth, especially with the weak Australian dollar making an Australian holiday more affordable for international tourists.

Auckland International Airport reported today that total passenger movements in the last 12 months had risen to 16.1 million, with both international and domestic recording strong growth during the period.

Both Auckland International Airport and Sydney Airport have generated strong returns for shareholders in recent years, with many of the returns from the latter coming in the form of dividends rather than capital gains.

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Motley Fool contributor Ryan Newman has no position in any stocks mentioned. Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. You can follow Ryan on Twitter @ASXvalueinvest.

The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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