by Jang Hyowon
Published 18 Apr.2023 08:15(KST)
On the 18th, Kiwoom Securities analyzed that a favorable wind is expected for the entry of Chinese VIPs into Lotte Tour Development after mid-April.
Namsoo Lee, a researcher at Kiwoom Securities, stated in a report on the same day, “Overseas travel resumed mainly to Japan in the first quarter, and although the air route to Jeju Island was not smooth due to bad weather, the performance is expected to meet consensus.” He analyzed, “Despite the slow recovery of the Jeju-China route and the non-operation of Hong Kong charter flights, which created an unfavorable business environment, traffic improvement likely occurred for both casino VIP and Mass customers due to the resumption of the Japan route.”
Researcher Lee explained, “In February, South Korea resumed issuing short-term visas to Chinese nationals, and last month, China resumed issuing visas to foreigners, lifting all travel restrictions between Korea and China due to COVID-19. Additionally, the visa-free entry system for Chinese nationals to Jeju, which was reinstated on June 1 last year, has removed all hurdles related to attracting tourists.”
He continued, “Therefore, considering the 1 to 3 months lead time for overseas travel after mid-March, the entry of Chinese VIPs is expected to accelerate from mid-April. Accordingly, VIP rolling and Mass drop in the second quarter are projected to grow by more than 50% compared to the first quarter, and the improvement scale in the third quarter, reflecting the full impact of Chinese performance, will expand further.”
Furthermore, he stated, “This year’s casino sales are expected to increase by 354% year-on-year to 198.6 billion KRW, showing a low-high pattern due to the resumption of Chinese VIP entries. The casino performance in 2024 is expected to improve to 311.6 billion KRW with full-year growth, competing with Yeongjongdo P-City for the title of the largest foreigner casino in Korea.”
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