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HK investors like Cambodian casino odds

19 October 2006

HONG KONG – As reported by Forbes: "Hong Kong investors obviously like gambling. Otherwise, how can you explain the heated bidding for NagaCorp., which on Wednesday floated the first initial public offering for a gambling company in Hong Kong. The public tranche of the IPO was 118 times oversubscribed.

"The other interesting thing about Naga is where it carries on its operations: the company runs the sole licensed casino in Phnom Penh, and it is not supposed to have any competition in Cambodia until 2035.

"With an IPO price of $1.43 Hong Kong (18 cents), Naga raised $631 million Hong Kong ($80.1). Most of the proceeds will be used to build a new hotel complex, with the rest spent on adding to the casino's gaming tables, currently numbering 44. In addition, the casino features 211 gaming machines.

"Despite of its modest facilities, Naga recorded $24.5 million of net profit in 2005. With an operating margin of more than 40%, the casino is more profitable than such American giants as Las Vegas Sands (27%) and MGM Grand (20%)…"

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