Suncity expands operations in Manila:UBS

SunCity will be enlarging its footprint in Manila soon, with fixed room operations in City of Dreams and Bloomberry’s Solaire Casino, UBS analysts said in a note.
The group will commit to a total of 42 tables in the two casinos and plans to invest a total of HK$1 billion ($128.8 million) in initial cage capital in the city, Anthony Wong and Angus Chan wrote.
“The commitment to fixed rooms (vs. its casual operations that exist in most regional destinations, including Manila) and the size of capital involved shows the group’s
determination to expand, in our view.”
The analysts estimate HK$1 billion of capital will lead to rolling of HK$5 billion to 8 billion per month “On a per table basis, this would imply daily rolling of US$0.5m-0.8m. Although this seems high compared to the Manila average of US$0.3m, we believe overtime it is possible given SunCity Macau at US$2m (Macau average at US$0.9m in Q115E).”
SunCity is the largest junket group in Macau with 25 to 30 percent market share in the junket VIP segment, 210 tables and rolling volume of HK$100 billion per month.
“We believe SunCity will share commissions as high as 2.1% of rolling to agents (73% on revenue share), implying commission rates casino operators pay SunCity should be at least 75%+.”