Likely a growth year for Cambodia’s NagaWorld: Citi

Apr 14, 2016 Newsdesk Latest News, Rest of Asia, Top of the deck  

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Citigroup Global Markets Inc says it thinks 2016 will be a positive year for NagaWorld (pictured), the only casino resort in Cambodia’s capital Phnom Penh. The property is operated by Hong Kong-listed casino NagaCorp Ltd.

“[The year] 2016 will likely continue to be a growth year for NagaWorld,” analysts George Choi, Anil Daswani and Aras Poon wrote in a note issued last week.

They added that the property’s “Macau-based junkets should continue to fuel VIP gross gaming revenue (GGR) growth, albeit at a much lower rate” than in 2015. Citi forecast VIP rolling chip turnover at NagaWorld to go up by 15 percent in full-year 2016, a slowdown from the 27-percent jump recorded last year.

In June 2015, a unit of Jimei International Entertainment Group Ltd – a Hong Kong-listed casino junket investor with its roots in Macau – made a junket arrangement with NagaCorp relating to seven VIP tables at the latter’s NagaWorld casino resort. The arrangement was for one year and renewable for a further year subject to agreement of the parties.

NagaCorp said in February that the continued downturn in the gaming sector in Macau offered “opportunities for the group to further penetrate the regional gaming market of both the VIP and mass market, by offering better commercial terms to junket operators and agents as a result of NagaWorld’s low cost structure”.

In their note, Citi’s team said they estimated mass market GGR growth at NagaWorld “to slow to circa 12 percent (from 18 percent last year), reflecting the moderating visitation growth.”

NagaWorld recorded GGR of US$153.8 million in the first quarter of 2016, representing an increase of 35 percent in year-on-year terms, NagaCorp announced last week.

In May last year NagaCorp broke ground on a casino resort it plans to build in a special economic zone in Primorsky Krai in the Russian Far East.

The chairman of NagaCorp confirmed to GGRAsia last month the shortlisting of the firm regarding a casino licence in the Republic of Cyprus. The shortlist was described in media reports as involving three parties: NagaCorp; a consortium involving Melco International Development Ltd; and Philippine casino operator Bloomberry Resorts Corp.

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