[Click eStock] "Paradise to Continue Performance Growth in 2020"

[Asia Economy Reporter Oh Ju-yeon] Kiwoom Securities forecasted on the 10th that Paradise's sales and operating profit are expected to increase through the rapid growth of Paradise City in Yeongjongdo last year. In particular, Paradise City is expected to continue growing in 2020, and the operations of the other three business sites are also estimated to proceed smoothly.

Researcher Lee Nam-su analyzed, "The sales growth trend that continued throughout 2019 will also carry on into the fourth quarter," adding, "The year-end peak season effect will be as significant as the traditional peak season in the third quarter." Although the per capita drop amount (the amount customers exchange for chips at the casino) in the fourth quarter was 25.8 million KRW, lower than the 28 million KRW average from the first to third quarters of 2019, the increase in the hold rate (the casino's winning rate in games) to 13.1% is expected to result in sales of 276.9 billion KRW, surpassing consensus estimates for both sales and operating profit.

Researcher Lee judged, "The growth in hold rate achieved under controlled marketing efforts will serve as an important point to expand performance leverage, as an increase in customer attraction is expected in 2020."

In 2020, it is expected that the negative base effect on the drop amount due to last year's promotions and the hold rate increase effect from limited promotions will appear simultaneously.

Researcher Lee stated, "Sales growth due to the increase in hold rate is expected to outweigh the drop in drop amount. The average monthly drop amount in the second half of 2019 was 548.1 billion KRW, and even without growth in 2020, if a conservative hold rate of 12% is recorded, performance exceeding that of 2019 will be achieved." He maintained a 'Buy' investment opinion and raised the target stock price to 28,000 KRW.

This content was produced with the assistance of AI translation services.