SJM HOLDINGS(00880.HK)：NEW PROPERTY OPENING-格隆汇

机构：申万宏源研究
研究员：Jia Mengdi

　　SJM Holdings reported 2Q21 net revenue of HK$2.7bn (+207% YoY, +11% QoQ), and adjusted Ebitdaof -HK$191mn, lower than our expectation. We lower EPS forecasts from HK$0.27 to HK$0.16 in 21E(+130% YoY), from HK$0.48 to HK$0.33 in 22E (+105% YoY), and from HK$0.67 to HK$0.51 in 23E(+54% YoY). We lower target price from HK$10.5 to HK$8.0. With 19.4% upside, we maintainOutperform rating.
　　Mass driven play. In 2Q21, SJM’s GGR (gross gaming revenue) increased 8% QoQ. Mass tablerevenue was 38% of the 2Q19 level, slot revenue recovered 52% while VIP revenue reached 11% ofthe 2Q19 level.
　　New property opening. The company’s new property Grand Lisboa Palace was opened on July 30th.
　　The property will be launched in phases. The first phase includes the casino, which has been granteda total of 150 mass gaming tables and authorised to operate 1,200 slot machines, 300 guest roomsat the Grand Lisboa Palace Macau hotel, some restaurants and space for events. When fullyoperational, Grand Lisboa Palace will feature a total of 1,892 rooms and suites in three hotel towers,including a Grand Lisboa Palace Macau hotel, a “Palazzo Versace”-branded hotel, and a “KarlLagerfeld”-branded hotel. The company would reallocate 118 gaming tables to Grand Lisboa Palacefrom its existing casinos.
　　Delayed recovery. Due to a rise in the number of local Covid-19 infection cases in mainland China,with effect from July 31st, people intending to enter Macau on a direct flight from mainland Chinamust provide a negative Covid-19 test result obtained within 48 hours (previously seven days) ofarrival in Macau. On August 3rd, the Macau government announced that the region had entered“immediate pandemic prevention” mode, after four locals from the same family tested positive forCovid-19. From 3:30 p.m. August 3rd, all those leaving Macau must present a negative Covid-19 testresult valid for 24 hours. From 6 a.m. August 4th, all those crossing the Guangdong-Macau bordermust present a negative Covid-19 test result issued within the past 12 hours. We believe stockcatalysts include the streamlining of testing procedures, resumption of e-visa processing under theIndividual Visit Scheme and the return of package tours.
　　Maintain Outperform. We lower target price from HK$10.5 to HK$8.0. With 19.4% upside, wemaintain Outperform rating