Japan's "Massive Opportunity" for Gambling Operators, According to Macquarie

In a report published Wednesday, Macquarie analyst Chad Beynon commented that the legalization of gaming in Japan and the subsequent integrated resorts is a “massive opportunity” for operators. Japanese parliament met to debate a preliminary bill for the legalization of casinos. According to Macquarie, the session is concluding on June 22, with no further debate scheduled. Shares of Las Vegas Sands LVS fell sharply compared with its peers due to the delay as analysts, including Beynon, see the company as “best positioned” due to the company's experience and relationships in Japan. Macquarie remarked, “The Japanese have traditionally shown a keenness for betting, with legal horseracing, bike/boat races, a national lottery & pachinko all popular in the country. The pachinko industry is in favour of the integrated resorts because they want to invest. We think issues around problem gambling can be addressed.” The analyst added that various partnerships between operators and local companies are “likely”. Beynon sees Japanese companies including Konami, Japan Cash Machine Co, Oizumi Corp and Sega Sammy benefitting from such relationships. In addition, shares of Las Vegas Sands, MGM Resorts MGM, Wynn Resorts WYNN, Melco Crown Entertainment MPEL, Caesars Entertainment CZR, and SJM Holdings will likely see gains contingent on the approval of gambling legalization by Japanese legislation.