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Fitch optimistic of Japan bill passage, cool on S. Korea

Fitch Ratings says it believes Japan’s casino liberalization bill stands a better than 50 percent chance of being passed this year, though it says it doesn’t believe the first integrated resort will be open in time for the 2020 Olympic games in Tokyo.

The ratings agency, whose analysts recently completed an Asia tour, also said it is cautious about the foreigner-only casino market in South Korea, which is currently generating so much interest from potential investors.

Fitch says it sees Japan’s casino industry as being modelled on that of Singapore, with limited licenses and an entrance fee levied on locals. Osaka and Yokohama are the likely locations for the two major IRs, and multiple smaller satellite licenses are also discussed.

“We think the two major IRs can generate over $6 billion combined in revenues. This assumes 500 table games and 3,000 slot machines each and respective win per day rates of around $14,000 and $600. This is above roughly $5.5 billion being generated by Singapore’s two IRs,” it said in a note.

On South Korea, the agency said it agrees northern China remains underpenetrated, however even if the foreigners market can double from the current base, that would equate to less than 10 percent return on investment with approximately $5 billion of capital in the pipeline.

Competition for northern Chinese players will also intensify over the next few years with legalization looming in Japan and Vladivostok’s first casino due to open this year.

“We believe there is minimal chance of Korea expanding gaming to nationals in the medium term,” it added.

South Korea has 16 foreigner-only casinos in hotels across Incheon, Seoul, Busan and Jeju.


Caesars Entertainment, Mohegan Tribal Gaming Authority, Genting Singapore and Sega Sammy are among those interested in developments in South Korea.

Asia Gaming Brief is a news and intelligence service providing up to date market information for worldwide executives on relevant gaming issues in Asia.

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