CICC has reiterated its "Outperform" rating for NAGACORP (03918), maintaining a target price of HK$6.50. This valuation is based on the company's resumption of a full-year dividend payout ratio of 30% and corresponds to 8 times the projected 2026 EV/EBITDA. The target implies a potential upside of 65% from the current share price. Considering the company's current operational efficiency, the firm has revised its 2026 EBITDA forecast downward by 10% to $431 million, while introducing its inaugural 2027 EBITDA estimate of $515 million. NAGACORP's current share price trades at 4 times its projected 2026 EV/EBITDA.
The company reported its second-half 2025 results, with total revenue reaching $368 million, representing a 36% year-on-year increase and an 8% sequential growth, recovering to 43% of the second-half 2019 level. This included total gaming revenue of $359 million, which grew 38% year-on-year and 8% quarter-on-quarter, recovering to 42% of the second-half 2019 figure. Second-half 2025 EBITDA was $204 million, up 39% year-on-year and 2% sequentially, reaching 60% of the second-half 2019 level, largely aligning with the expected $205 million.
The performance is primarily attributed to a steady recovery in business volume, particularly during the third quarter of 2025. Cambodia's trial four-month visa exemption for Chinese tourists and the capacity expansion potential of the newly opened Techo International Airport are expected to further accelerate the recovery of Chinese visitor numbers to Cambodia. Additionally, with enhanced cooperation on development between China and Cambodia, the four-month visa exemption program may potentially be extended further.
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