First Shanghai Securities·2026-03-04 11:26Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 51.05, representing a potential upside of 29.63% from the current stock price of HKD 39.38 [2][4]. Core Insights - The company reported a 33% year-on-year growth in EBITDA for Q4 2025, with a payout ratio increased to 61% [2]. - The overall performance for Q4 2025 met expectations, driven by increased foot traffic, improvements in high-end and VIP business, and the relaxation of visa policies [4]. - The company has a strong balance sheet with net cash of HKD 35 billion, positioning it as one of the strongest in the industry [4]. Financial Summary - Total net revenue for 2024 is projected at HKD 43,432 million, increasing to HKD 61,854.3 million by 2028, with a compound annual growth rate (CAGR) of 10.8% [3][5]. - EBITDA is expected to grow from HKD 12,188 million in 2024 to HKD 18,753.5 million in 2028, reflecting a CAGR of 12.1% [3][5]. - Net profit is forecasted to rise from HKD 8,759.2 million in 2024 to HKD 13,935.4 million in 2028, with a CAGR of 11.9% [3][5]. - The company’s earnings per share (EPS) is projected to increase from HKD 2.0 in 2024 to HKD 3.2 in 2028 [3][5]. Operational Highlights - The company’s market share is estimated to reach 22%, with significant contributions from the "Galaxy Macau" and the StarWorld Hotel, which reported net revenue growth of 28.8% and a slight decrease of 1.1% respectively [4]. - The EBITDA margin for "Galaxy Macau" is reported at 34.1%, while the StarWorld Hotel's EBITDA margin stands at 27.9% [4]. - The company is continuing to develop its fourth phase of "Galaxy Macau," expected to be completed by 2027, which will introduce several high-end hotel brands and additional facilities [4].