Investor potential in Naga Corp – Naga Corp (SHKE: 3918) the Hong Kong-listed operator of Phnom Penh casino complex Naga World has partially reopened its local operations after being forced to close due to COVID 19 concerns in March.
It has been reported to Cambodia Investment Review the company’s flagship casinos in Phnom Penh were able to partially reopen under COVID restrictions on September 13.
Under new COVID 19 entry requirements all guests must be fully vaccinated and required to undergo a COVID rapid test before entering.
Investors have earmarked a strong recovery is likely for the gaming business after its share price fell to around HKG 6 a share from HKD 10.96 in February.
In addition, the government has discussed the country is preparing to reopen its borders to fully vaccinated international tourists soon.
The company reported a stronger than expected half yearly results in which the company was able to post $17.7 million in first-half net income despite being closed since March.
The report stated a positive but uncertain outlook listing Cambodia’s high level of vaccination rates, strengthening Cambodia-China economic ties, and a possible reopening of Cambodia’s tourism industry in the fourth quarter of this year to fully vaccinated tourists.
“As of 30 June 2021, the Group’s cash and deposits were $275.4 million. The Group has sufficient liquidity and cash reserve to fund cash expenditures during the voluntary temporary suspension of business operations. The Company has no debt repayment obligation until July 2024.”
“Looking ahead, 2021 will remain challenging largely resulting from economic uncertainties arising from the unprecedented COVID-19 pandemic.”
In response to the COVID 19 impact the company has reduced its total workforce from 8,371 in December last year to 6,958 as of 30 June costing a total of $66.2 million for the six months.
Naga Corp investor relations has not responded publicly on the mass layoffs accounting for approximately 16% of its workforce or the accusations from labor groups that it has unfairly targeted union members.
NagaWorld is Phnom Penh’s only integrated hotel and entertainment complex has a 70-year casino license that will run until 2065, as well as exclusive rights to operate casinos within a 200-km radius of Phnom Penh.
Chinese Malaysian businessman Chen Lip Keong is the founder and majority shareholder of Naga Corp. He received Cambodian citizenship in October last year.