Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

Equity Bottom-Up

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<a href="https://www.smartkarma.com/entities/digiplus-interactive-corp" target="_blank" data-smartkarma-citation="entities:23060:1" rel="noopener">DigiPlus Interactive (PLUS PM)</a> presented PSE Star investor day yesterday and briefly analyzed two game-changing catalysts from the call: a) CasinoPlus acquisition and b) Brazil license. </li>
<li>The expected TAM associated with e-games/Bingo in Brazil is 250 bn pesos (4 bn USD), compared to the Philippines, which is currently cycling at 160 bn pesos (Q3 PAGCOR data). </li>
<li>The stock trades at 7.8x FYPE with 15% of the market cap in cash and a 3.8% dividend yield (30% payout ratio) with a seasonal uptick in Q4 FY24. </li>
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DigiPlus Interactive (PLUS PM) presented PSE Star investor day yesterday and briefly analyzed two game-changing catalysts from the call: a) CasinoPlus acquisition and b) Brazil license. 
The expected TAM associated with e-games/Bingo in Brazil is 250 bn pesos (4 bn USD), compared to the Philippines, which is currently cycling at 160 bn pesos (Q3 PAGCOR data). 
The stock trades at 7.8x FYPE with 15% of the market cap in cash and a 3.8% dividend yield (30% payout ratio) with a seasonal uptick in Q4 FY24. 


DigiPlus (PLUS PM): Brazil License And CasinoPlus Acquisition Game Changing Catalysts For The Future

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<a href="https://www.smartkarma.com/entities/digiplus-interactive-corp" target="_blank" data-smartkarma-citation="entities:23060:1" rel="noopener">DigiPlus Interactive (PLUS PM)</a> reported a solid Q3 2024 with core revenues/profits up 171%/243%YoY.  QoQ revenues remained flat as competition ramped up. </li>
<li>The company paid off all its gross debt, and net cash increased to 12 bn pesos (around 15% of market capitalization) </li>
<li>Trading at 8.2/6.4x FY24/25 PE, with 15% of the market cap in cash and a 5% dividend yield, the stock is worth considering. </li>
</ul>



DigiPlus Interactive (PLUS PM) reported a solid Q3 2024 with core revenues/profits up 171%/243%YoY.  QoQ revenues remained flat as competition ramped up. 
The company paid off all its gross debt, and net cash increased to 12 bn pesos (around 15% of market capitalization) 
Trading at 8.2/6.4x FY24/25 PE, with 15% of the market cap in cash and a 5% dividend yield, the stock is worth considering. 


DigiPlus Interactive Corp (PLUS PM): Solid Q3 2024, Enter the Peak Q4 Season

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<li>We are slowly building out a high-conviction coverage of ideas for the mid and small-caps in the Philippines. </li>
<li>We set criteria for high ROCE, reasonable growth (10-15% YoY), strong balance sheets, and reasonable capital allocation (dividend yields), all ingredients for being multi-baggers. </li>
<li>We like <a href="https://www.smartkarma.com/entities/ginebra-san-miguel-inc" target="_blank" data-smartkarma-citation="entities:23029:1" rel="noopener">Ginebra San Miguel (GSMI PM)</a>, <a href="https://www.smartkarma.com/entities/the-keepers-holdings-inc" target="_blank" data-smartkarma-citation="entities:23003:1" rel="noopener">The Keepers Holdings (KEEPR PM)</a>, <a href="https://www.smartkarma.com/entities/digiplus-interactive-corp" target="_blank" data-smartkarma-citation="entities:23060:1" rel="noopener">DigiPlus Interactive (PLUS PM)</a>. We will also be exploring <a href="https://www.smartkarma.com/entities/centro-escolar-university" target="_blank" data-smartkarma-citation="entities:22989:1" rel="noopener">Centro Escolar University (CEU PM)</a> </li>
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We are slowly building out a high-conviction coverage of ideas for the mid and small-caps in the Philippines. 
We set criteria for high ROCE, reasonable growth (10-15% YoY), strong balance sheets, and reasonable capital allocation (dividend yields), all ingredients for being multi-baggers. 
We like Ginebra San Miguel (GSMI PM), The Keepers Holdings (KEEPR PM), DigiPlus Interactive (PLUS PM). We will also be exploring Centro Escolar University (CEU PM) 


Shortlist of High Conviction Philippines Equity Ideas

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<a href="https://www.smartkarma.com/entities/digiplus-interactive-corp" target="_blank" data-smartkarma-citation="entities:23060:1" rel="noopener">DigiPlus Interactive (PLUS PM)</a> is the Philippines platform for Bingo Plus and other e-casino games, trading at 7x in the midst of &gt;100% growth in revenue/profitability in 2024. </li>
<li>The company is net cash with a &gt;50% ROE and is in an industry forecast by PAGCOR (regulator) to grow at least 15% CAGR in the future years.</li>
<li>We expect explosive Q2 revenue/profit growth of 226%/298% YoY which would act as a share price catalyst. We calculate a dividend of 0.80-1 peso/share (30-40% payout ratio), equating to a 4-5% yield.</li>
</ul>



DigiPlus Interactive (PLUS PM) is the Philippines platform for Bingo Plus and other e-casino games, trading at 7x in the midst of &gt;100% growth in revenue/profitability in 2024. 
The company is net cash with a &gt;50% ROE and is in an industry forecast by PAGCOR (regulator) to grow at least 15% CAGR in the future years.
We expect explosive Q2 revenue/profit growth of 226%/298% YoY which would act as a share price catalyst. We calculate a dividend of 0.80-1 peso/share (30-40% payout ratio), equating to a 4-5% yield.


Digi Plus Interactive (PLUS PM): Bingo Plus Platform, Trading At 7x PE with >100% Growth In 2024

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<a href="https://www.ggrasia.com/pagcors-new-limits-on-online-cash-rebates-and-cashback-positive-and-necessary-industry-expert" target="_blank" rel="noopener">PAGCOR</a> imposed a PHP 9M/month fee and capped promotional credits to offset GGR share payments, compressing margins and removing a key cashback mechanism, triggering a 23% de-rating to PHP 11.40.</li>
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<strong>Promo cap and fee disproportionately hurt smaller operators</strong> who relied on aggressive promotional credits to offset PAGCOR share; PLUS, with its scale and brand, is better positioned to withstand this.</li>
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<strong>At PHP 11.40, PLUS trades at 4.2x FY26e P/E and 2.6x EV/EBITDA with a 7.6% forward yield</strong>: near historic trough multiples on a PHP 19.8B net cash balance sheet.</li>
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PAGCOR imposed a PHP 9M/month fee and capped promotional credits to offset GGR share payments, compressing margins and removing a key cashback mechanism, triggering a 23% de-rating to PHP 11.40.

Promo cap and fee disproportionately hurt smaller operators who relied on aggressive promotional credits to offset PAGCOR share; PLUS, with its scale and brand, is better positioned to withstand this.

At PHP 11.40, PLUS trades at 4.2x FY26e P/E and 2.6x EV/EBITDA with a 7.6% forward yield: near historic trough multiples on a PHP 19.8B net cash balance sheet.


DigiPlus (PLUS PM): PAGCOR Crackdown Drives De-Rating — But the Rules Change A Long-Term Positive

Philippines

DigiPlus Interactive is a digital entertainment company operating in the Philippines, specializing in online and land-based gaming. The company offers a diverse portfolio of products including bingo, e-casino, specialty games, sports betting, and poker through platforms like BingoPlus, ArenaPlus, SpinPlus, and GameZone. Headquartered in Taguig City, Philippines, the company was founded in 1957.

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DigiPlus Interactive (PLUS PM)

DigiPlus (PLUS PM): Brazil License And CasinoPlus Acquisition Game Changing Catalysts For The Future

We summarize/analyze two huge catalysts for Digiplus Interactive (PLUS PM) that we learned about on the PSE Investor Day call: obtaining the a)...

Sameer Taneja

DigiPlus Interactive Corp (PLUS PM): Solid Q3 2024, Enter the Peak Q4 Season

We summarize Digiplus Interactive Corp (PLUS PM) 's Q3 2024 result. Trading at 8.2/6.4x FY24/25 PE, with 15% of the market cap in cash and a 5%...

Sameer Taneja

Shortlist of High Conviction Philippines Equity Ideas

We compile our selection of small and mid-cap names for the Philippines with our desired characteristics of high dividend yields, value, and margin...

Sameer Taneja