Citi Research lowered its target price for Sands China (01928) to HK$47 from HK$52, and maintained its "buy" rating.
The research house believes there are significant risks that Sands China will get a lot fewer new tables for the Paris-themed Parisian (expected to be completed in mid-2016) from the government than it asked for.
Today, Sands China has 1,500 gaming tables, ranking it second in Macau only behind SJM (00880). Citi therefore believes that Sands China will only get about 100 new gaming tables. If Sands moves 200 tables from Sands Macao and Venetian, the Parisian will open doors with 300 gaming tables.
Accordingly, the research house lowered its estimated fully-ramped EBITDA by 14% from US$940m to US$810m, implying an ROIC of 30% (versus previous forecast of 34.8%).
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