[Click e-Stock] "Lotte Tour Development Sets New Casino Record in September... Target Price Raised to 30,000 Won"

On October 2, DS Investment & Securities analyzed that Lotte Tour Development continued its steep growth trajectory by setting a new monthly record for casino performance in September. The firm maintained its 'Buy' investment rating and raised its target price by 30% to 30,000 won.

Cho Daehyung, a researcher at DS Investment & Securities, stated, "Lotte Tour Development's drop amount, net sales, and visitor numbers in September all continued to grow compared to the previous month." He explained, "The total drop amount reached 293.3 billion won (265.8 billion won from tables and 27.5 billion won from machines), more than doubling from the same period last year, and is now on the verge of surpassing the 300 billion won monthly mark."

The increase in hold rate also contributed to revenue growth. He added, "The hold rate improved by 2.8 percentage points from the previous month to 19.2%, resulting in casino sales of 52.9 billion won in September, which is about 86% higher than the same period last year."

He continued, "The number of visitors in September was 59,050, an increase of about 65% from last year, and the customer database has expanded to approximately 110,000."

The third quarter results are expected to exceed market expectations. Cho forecasted, "Thanks to the strong casino performance, third-quarter sales are projected at 196.3 billion won, up about 41% from last year, and operating profit is expected to more than double to 44.7 billion won." He also noted, "Currently, the proportion of casino guests among all hotel rooms remains at about 50%, indicating ample capacity to accommodate additional visitors." He further added, "The increase in the total number of tables to 167 in September is another positive factor."

The annual outlook is also bright. Cho stated, "Sales in 2025 are expected to reach 645.4 billion won, up about 37% from last year, and operating profit is projected to more than triple to 125.9 billion won." He assessed, "As the casino's profit leverage enters a full-fledged expansion phase, the possibility of a turnaround in net profit has also increased."

Cho explained, "The upward revision of the target price is due to a slight increase in earnings estimates for 2025 and 2026 and a change in the base year to 2026." He emphasized, "As monthly and quarterly seasonality is gradually weakening, casino sales growth should be possible even in the relatively off-peak fourth quarter." He added, "The combination of the visa-free policy and the expansion of flight routes at Jeju International Airport will further accelerate the increase in visitors, which will directly translate into earnings growth."

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