菲律宾博彩业：亚洲赌场领域的崛起之虎.docx

4 November 4 November 2019 Equity Research Asia Pacific | Philippines Philippine Gaming SectorRising tiger Philippine Gaming Sector Rising tiger in the Asian casino space Casinos & Gaming | Initiation Figure 1: We expect the Philippines to have ASEAN's largest casino industry by 2021 (USD mn) 5,000 4,000 Research Analysts Justin Cimafranca 63 2 858 7756 justin.cimafranca@ 3,000 2,000 1,000 0 2017A 2018A 2019E 2020E 2021E 2022E Philippines Singapore Malaysia Source: Company data, Credit Suisse estimates The growth story continues. We expect the Philippine Gaming industry to breach the US$4 bn GGR mark in 2019 and become the largest casino industry in ASEAN by 2021. We see great potential for growth as: (1) foreigners only comprise ~20% of Mass GGR, and (2) table & slot yields are only ~30% those of Singapore. We forecast Entertainment City GGR to experience a CAGR of 15% until 2023. Keep your eyes on Mass. Despite VIP volumes showing signs of impact from the slowdown in China macro, we believe that the combination of: (1) rising disposable incomes; (2) connectivity improvement from progress in the infrastructure rollout; and (3) accelerating tourist arrivals from China should drive growth in the high-margin Mass segment. We expect a natural expansion in EBITDA margins as the contribution of Mass to total GGR rises from 55% in 2019 to 60% in 2021. Overblown risks offer buying opportunities. We argue that certain risk factors (gov’t regulation, the slowdown in China, intensifying competition and the ban on proxy gambling) are weighing on overall sentiment. Bloomberry’s EV/EBITDA of under 8.0x is ~1 standard deviation below its five-year mean, and is 40% lower than Macau’s five-year average. We are confident of the regulatory backdrop and believe these risks are overblown. We therefore expect valuations to rerate as the companies continue to deliver superior growth. Top pick is Bloomberry; prefer BEL over PLC for CODM exposure. We initiate coverage on the Phili