Ferrovial is best assessed primarily under **transportation infrastructure**, given its large investments in toll roads, airports and infrastructure concessions/projects. The business profile has meaningful strengths: infrastructure assets are long-life, often concession-based, and can produce relatively predictable cash flows, but Ferrovial’s consolidated profile also includes construction and equity-accounted infrastructure exposure, which makes leverage and cash-flow analysis less straightforward than for a pure regulated utility.

Key points for hybrid-bond capacity and need:

- **Existing hybrid starting point is already material.** Ferrovial reports **Other Equity Securities of about €508 million**, reflecting existing perpetual subordinated/hybrid instruments. This means hybrid debt is already part of the capital structure, so further issuance is not a “new instrument” issue, but there is also less incremental need than for a company with no hybrid capital.
- **Capital structure is leveraged but not in acute distress.** Reported equity was **€6.35 billion**, while total borrowings and lease liabilities were roughly **€11.84 billion** at year-end 2022. Total adjusted capital is therefore broadly around **€18 billion** before more refined S&P adjustments. A 15% hybrid equity-credit cap would imply a maximum hybrid component of roughly **€2.7 billion** of adjusted capital, and current hybrid-like equity of about **€0.5 billion** already represents around **3%** of total capital.
- **Funding needs are meaningful.** Infrastructure project investments increased materially, with **investments in infrastructure projects of €784 million** in 2022 versus €239 million in 2021. Noncurrent infrastructure project assets also rose strongly. This points to ongoing growth/capex needs.
- **Cash flow remains supportive but shareholder distributions are high.** Operating cash flow was strong at **€1.0 billion**, and cash before financing was still positive at **€270 million**, but shareholder remuneration was substantial at **€578 million**, and buybacks/dividends reduce balance-sheet flexibility.
- **Liquidity is strong.** Cash and equivalents were very high at **€5.13 billion**, including almost **€5.0 billion excluding infrastructure projects**. This reduces the urgency for a very large hybrid issue.
- **Profitability and coverage are adequate but not exceptional.** 2022 profit attributable to the parent fell to **€186 million** from a disposal-driven €1.2 billion in 2021. Operating profit was **€423 million**, while finance costs were significant. Hybrid issuance would improve adjusted leverage metrics, but coupon costs would be higher than senior debt.
- **Market timing is less favorable than in 2020-2021.** Euro swap rates rose sharply in 2022, and subordinated spreads are materially wider. This argues against maximizing issuance unless rating preservation clearly requires it.
- **No evidence of transformational M&A or near-term downgrade pressure requiring the full 15% cap.** The company has growth investments and leverage pressure, but also high liquidity, positive operating cash generation, and an existing hybrid base.

Overall, Ferrovial has a **moderate-to-meaningful rationale** for additional hybrid issuance: it is infrastructure-heavy, capital intensive, already uses hybrids, and could benefit from S&P equity credit to preserve balance-sheet flexibility while funding growth. However, strong liquidity and the higher hybrid cost argue against moving to the 11.25%-15% range. A move to **7.5% of total adjusted capital** is appropriate: this would represent a meaningful but not excessive increase from the current roughly 3% hybrid component and would provide useful rating flexibility without overpaying for subordinated capital.

<answer>7.5%</answer>