Shares of Landmarks Bhd jumped yesterday after the property firm inked an agreement that allows it to embark on licensed activities such as gaming at Indonesia's Bintan island.
The shares rose 22 sen or 7.4 per cent to RM3.18 at almost double the previous day's trading volume.
Early yesterday, research house ECM Libra reiterated its "buy" call on Landmarks and raised its target price to RM5.12 from RM3.68 before.
It became more bullish on the firm after the subsidiary - Bintan Treasure Bay Pte Ltd - announced an alliance with an Indonesian company, allowing the former to undertake certain activities at its Bintan Treasure Bay project.
These activities are medical tourism, multimedia and information technology hosting, as well as games and entertainment, including gaming.
Landmarks will pay the company, PT Wisata Hiburia, 10 per cent of its net profit from the integrated resorts project.
"While details are sketchy at the moment, we are very upbeat on the prospect of the proposed development of international class integrated resorts within such close proximity to Singapore," ECM said in a report yesterday.
Another research house, Aseambankers, also felt that the development is positive to Landmarks and its major shareholder, Genting Bhd, as this puts them a step closer towards realising plans to set up a casino in the proposed integrated resort in Bintan's Lagoi Bay.
However, the research house remains concerned as to how this development will fit into the framework of Indonesia's national anti-gambling laws.
It is also uncertain as to how Indonesia's predominantly Muslim population will react to the setting up of the country's first legal casino.
"We believe there could still be a few other approvals required before this integrated resort project takes off.
"Nevertheless, should Landmarks get all the necessary approvals to build the casino, this will significantly boost the profitability of the proposed Lagoi project," Aseambankers said in a note to clients yesterday.
It is understood that such as casino will cater only to foreign tourists and non-Muslims, it added. In 2007,
Bintan attracted around 330,000 visitors last year, mainly from Singapore, South Korea and Japan.
Aseambankers maintained its "hold" recommendation on Genting, with an unchanged target price of RM7.50.
Genting, which owns about 30 per cent of Landmarks, rose 25 sen to close at that target price yesterday.
By New Straits Times (by Adeline Paul Raj)
Saturday, January 26, 2008
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Govt urged to address casino issue in Bintan
Fadli , The Jakarta Post , Bintan | Tue, 05/13/2008 10:39 AM | The Archipelago
The Bintan regency administration has asked the government for an immediate ruling on legalizing gambling in the Bintan Exclusive Tourism Resort (KWTE).
The local administration and legislature said current law made legalized gambling a real possibility.
Djoko Zakaria, head of the KWTE ordinance special committee, told The Jakarta Post on Sunday gambling in public was forbidden under the Criminal Code, unless a permit had been issued by the relevant authorities.
"The legal system offers a chance for legalized gambling, provided a permit for it has been issued by the government," said Djoko, who is also vice deputy speaker of the Bintan legislature.
"However, we feel the government lacks decisiveness in enforcing the existing legal system. If the plan to set up a casino in Bintan is illegal, then the law should be revised accordingly," he said.
The draft provincial ordinance on the KWTE is aimed at easing the way for Malaysian developer Landmarks Bhd., which is planning to invest US$3.1 billion in the resort area, he said.
A point in the draft ordinance that incorporates electronic and manual gaming has raised public controversy.
"Some 13,000 local residents would be employed if the casino in Bintan was operational. The Home Ministry is currently handling the issue, but it's still not settled," said Djoko.
He said foreign parties were involved in lobbying against gambling in the province.
He said Indonesia was taking a backward stance, and pointed to Abu Dhabi as an example of an Arab state that had successfully implemented legalized gambling. Moreover, he said the tourist zone would be off-limits to Indonesian Muslims.
"The pressure from foreign parties are intended to prevent Indonesia benefiting from the huge amounts of gambling money circulating in Southeast Asia," said Djoko.
The regency administration submitted the draft provincial ordinance to the local legislature in September last year. It has yet to be approved by the government.
"This won't be gambling that's open to the public and can thus become a negative influence," said Djoko.
Bintan Regent Anshar Ahmad said public opinion was divided over the plan.
"From dialogues with the public through Radio Republic of Indonesia in Tanjung Pinang, many residents are in favor of the plan. It only depends on the government now. The Bintan legislature is still waiting for a positive signal from them," said Anshar.
PT Bintan Resort Cakrawala (BRC) vice president Brig. Gen. (ret.) Chin Chow Yoon said Landmarks Bhd., the biggest casino company in Asia, would continue its plan to build hotels and resorts in Lagoi even if the government did not approve the plan to build a casino there.
"We will still invest in Bintan Resort without a casino. However, our investments may likely be smaller," said Chin.
He said BRC, as the sole operator of the 23,000 hectare resort area, had asked other investors to develop the area as well to increase the chances of getting the permit.
"Landmarks Bhd. expects the casino complex to be safe and legitimate and not subject to illegal levies and extortion from corrupt officials," said PT BRC spokeswoman Nia Firtica.
A number of religious leaders in Riau Islands have urged the government to reconsider issuing a gambling permit in the province because it would set a precedent for other provinces and eventually lead to legalized gambling throughout the country.
"We are against the proposed casino. The government should be consistent in its prohibition of gambling, especially since President Susilo Bambang Yudhoyono clamped down on gambling in Riau Islands earlier," said Achmad Umar, an official at the Bintan office of the Indonesian Ulema Council.
From: The Jakarta Post 13 May 2008
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