Hot Stock Berjaya Corp rises 6% on Vietnam lottery biz

by **Cals** Wed 14 May 2014, 17:36

Hot Stock Berjaya Corp rises 6% on Vietnam lottery biz

Business & Markets 2014

Written by Jeffrey Tan of theedgemalaysia.com

Wednesday, 14 May 2014 12:53

KUALA LUMPUR (May 14): Tan Sri Vincent Tan’s Berjaya Corporation Bhd rose as much as 6% after the firm won the bid for the lucrative computerised lottery system for the whole of Vietnam.

An analyst told theedgemalaysia.com the firm would likely obtain the gaming licence to operate in the Southeast Asian country.

“We do not see any reason why Berjaya Corp will not get the licence. The Vietnamese government is serious in developing its gaming industry,” the analyst said over the telephone.

At 11.48 am today, Berjaya Corp gained 1.5 sen or 3% to 50.5 sen after hitting a high of 52 sen. The eighth most active counter saw trades of some 21.5 million shares.

InterPacific Securities’ senior remisier Sam Ng told theedgemalaysia.com that if Berjaya Corp secures the contract, the firm will have a bright future ahead.

“The market [gaming industry] in Vietnam is 10 times larger as compared to Malaysia,” Ng remarked.

On Monday, Berjaya Corp and its 48.64%-owned subsidiary Berjaya Sports Toto Bhd (BJToto) jointly announced that Berjaya Corp had won the bid to undertake the investment, procurement, installation of equipment and operation of a computerised lottery system.

This is in collaboration with Vietnam Lottery Company (Vietlott), a wholly-owned subsidiary of the Ministry of Finance, Vietnam.

According to the statement, Berjaya Corp has been formally invited to enter into negotiations for a business cooperation contract with Vietlott.

“We are positive on the development. BJToto will have first mover advantage in Vietnam and monopoly over the gaming industry,” said the analyst.

Nevertheless, the analyst said earnings would not be excessive in the short term. He added Berjaya Corp would get the lion’s share of earnings given its effective 40% stake in the deal.

Berjaya Corp owns an 80% stake in Berjaya Lottery Vietnam Ltd (BLV), which in turn owns a 51% stake in Berjaya Gia Thinh Investment Technology Co Ltd that will undertake the project.

But Berjaya Sports Toto Bhd (BJToto) remained flat with 275,100 shares done.

A research report by Public Investment Bank Research said the venture in Vietnam would have minimal impact on BJToto’s earnings.