By Revin Mikhael D. Ochave, Reporter
SHARES OF TANCO-LED DigiPlus Interactive Corp. jumped on Tuesday after President Ferdinand R. Marcos, Jr. made no mention of online gambling in his fourth State of the Nation Address (SONA), which analysts said may have eased investor concerns about a possible ban.
DigiPlus shares closed higher by 11.06%, or P3.55, to P35.65 apiece on Tuesday. The company operates the gaming platforms BingoPlus, ArenaPlus, and GameZone.
However, analysts warned that the stock could face volatility amid ongoing discussions on stricter online gambling regulations.
“It seems the market is taking a ‘no news is good news’ stance, with investors assuming that the lack of mention during the SONA means that a full ban is not forthcoming. However, we still believe that tighter regulation for the sector is inevitable,” AP Securities, Inc. Research Head Alfred Benjamin R. Garcia said in a Viber message.
During his SONA on Monday, Mr. Marcos covered economic growth, food security, energy reforms, and social services, but did not mention legislation seeking to outlaw or better regulate online gaming.
Bills seeking to either ban or regulate online gambling have been filed in the Senate and House of Representatives, citing concerns over its social impact.
Online gambling operators like DigiPlus have advocated for stricter regulation rather than a total ban, arguing that proper oversight would help deter players from shifting to unregulated or illicit platforms.
“This suggests that proposed restrictions on online gambling may not be priority legislation and, if pursued at all, may face a long and uncertain path to enactment after extensive revisions and debate,” DragonFi Securities, Inc. Equity Research Analyst Jarrod Leighton M. Tin said in a Viber message.
China Bank Capital Corp. Managing Director Juan Paolo E. Colet said in a Viber message that the omission bodes well for DigiPlus despite the proposed stricter online gambling regulations.
“The immediate post-SONA market reaction has been positive for online gaming stocks, especially DigiPlus. It’s a good exercise in prudence by the President to give legislators, regulators, and stakeholders the opportunity to reach an appropriate resolution,” he said.
“At this point, the most reasonable outcome would be an enhanced but economically sensible regulatory environment for legitimate digital gambling. Major players that can ensure compliant operations stand to benefit the most from a balanced gaming landscape,” he added.
Unicapital Securities, Inc. Research Head Wendy B. Estacio-Cruz said that mentioning stricter online gambling controls during the SONA could have sent the wrong signal to investors and stakeholders.
“This omission seems intentional. It’s possible that the President is still weighing economic considerations, as online gambling continues to generate substantial revenue for both the Philippine Amusement and Gaming Corp. and the government,” she said.
Despite the omission, Mr. Garcia projected continued volatility in gaming stocks such as DigiPlus until there is a clearer policy direction on online gambling.
“No mention of an online gambling ban in the SONA does not mean it’s not being considered, and calls for tighter regulation are too loud for the status quo to be maintained. So even if there is no outright ban, tighter restrictions will definitely hamper future growth,” he said.
“Without more details to work with, the market will continue to speculate, which could lead to wild swings. Even after more details become available, it will take some time for prices to settle down as investors attempt to price in the effects,” he added.
Ms. Estacio-Cruz said investors should remain cautious about gaming stocks amid the regulatory uncertainty.
“We believe investors should remain cautious until we see final word from the government,” she said.
“Unicapital Securities Research still has a neutral rating on gaming stocks due to regulatory risks,” she added.
