Gaming / Genting HK: Nomura interviews Mr. Takashi Kiso, President of International Casino Institute Inc in Japan, on the country’s casino legislation. He says there is political agreement (btwn DPJ and LDP) for a casino bill given the need to stimulate Japan’s economy/ tourism post the ’11 earthquake and tsunami. Believes a “detail lite” bill legalizing gaming could be submitted in Feb.
Nevertheless, the whole process is expected to be long drawn; even if the bill were approved, licensees could be selected in 2014/15, and the first casino expected to open in 2017/18.
Kiso also believes, i) there could be 2-3 casinos to start (at least one urban and one rural location), eventually increasing to 10 casinos, ii) gaming tax rate to be 20-30%, iii) min invmt >US$4b per location, iv) licensed junkets allowed, v) locals likely need to pay a levy to enter like in Spore.
Expect the Japan gaming theme to be a recurring one, as new updates come in. Officials want to use the Spore IRs as the development model, leaving the Genting group well positioned. Nevertheless competition is stiff with LVS, WYNN, MGM and MPEL all tipped to be interested, and there is no clear leader yet. Genting HK has previously mentioned its interest to enter the Japan market if the gaming bill is passed.
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