J.P. Morgan Chase released a research report saying that maintaining the “neutral” rating of Aobo Holdings (00880), the first quarter of this year's performance was steady, and revenue and profit performance improved. Taking into account management's expectation that Lisboa's market share will continue to grow, the EBITDA forecast for the 2024-2025 fiscal year was raised by about 5%, and the target price was raised from HK$3 to HK$3.3.
The bank said that it is currently unsure that Aobo can reach its 5% market share target in the next few years. At the same time, it believes that Aobo's deleveraging progress is disappointing. It is currently the only gaming operator in the industry that has not yet been able to generate significant free cash flow. It believes that the burden of debt costs and capital expenses is relatively heavy, and that the valuation is expensive. The current profit forecast for Aobo is slightly lower than market expectations.