Analyst: Not worth it for Packer
With the election of Maithripala Sirisena as the new president of Sri Lanka, Crown Resorts Ltd. could have a tougher time advancing its plan to build a US$400 million casino resort on the island. Not only will the anti-casino candidate be assuming office, but in December Mahinda Rajapake, a government official more favorable to casinos, joined Sirisena’s side, reported Reuters.
An unnamed analyst told the Australian Financial Review that Crown owner James Packer would be well-advised to leave the jurisdiction instead of pursuing a license there. “To commit any money to a developing country like Sri Lanka, Crown would need regulatory certainty, tax breaks and full license for a casino,” the analyst said. “They’re not in the business of running hotels for the sake of it.”
According to GGRAsia, J.P. Morgan Securities Australia Ltd. recently announced it would downgrade its estimates on earnings per share for Crown this year by 0.9 percent, to AUD0.83 (US$0.67) per share. That change resulted from “ongoing softness in the Macau market.” Analysts predicted the lower Australian dollar would “provide a tailwind, especially in FY16 and FY17.”
