Tycoon Enrique Razon Jr.’s new Solaire Resort North casino in Quezon City is expected to significantly increase Bloomberry Resorts’ (BLOOM) revenues, driven by its mass-market focus and large catchment area covering nearby northern provinces, according to AP Securities Inc.
Solaire Resort North, BLOOM’s second casino in Metro Manila, opened last May 25, attracting as many as 14,000 visitors during its opening night that was attended by President Marcos.
Buy rating
“Despite some slowdown in recent quarters, which reflects the broader weakness in discretionary spending, BLOOM remains our top brick-and-mortar pick for the gaming sector,” AP Securities said.
AP Securities has a buy rating on BLOOM based on its consensus target price of P14.26 per share. This implies a 37 percent upside from its current price.
Revenue growth
Fully ramping up could take a while longer.
Donato Almeda, vice chair for construction and regulatory affairs at Bloomberry, said not all of their 526 hotel rooms have been opened to ensure these have met their high standards.
For AP Securities, Solaire Resort North is expected contribute P22.5 billion or about 46 percent of Solaire Resort Entertainment City's projected revenues this year, going up to 68 percent in 2025.
Mass market bet
Solaire Resort North has a smaller land footprint than the Solaire Resort Entertainment City, making the location ideal for its mass-market-focused positioning.
Solaire Resort North will have 42 percent more slot machines, a higher margin segment, but less than half of Solaire Resort’s table count.
“The mass market focus also makes sense considering the demographics of the area that the property aims to serve,” AP Securities Inc. said.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
