DigiPlus receives Brazil gaming license

In an update to a story that I have been following closely, DigiPlus [PLUS 28.95 ?6.8%; 215% avgVol] [link] has officially received “definitive authority to operate sportsbetting and other online games in Brazil” through the Brazil government’s granting of a federal gaming license to PLUS’s subsidiary, DigiPlus Brazil Interactive. PLUS said that “only 10% of the total applicants received Definitive Authority” from the Brazilian government through this process. PLUS now has the ability to conduct its online gaming operations, as the license became effective on New Year's Day.

MB BOTTOM-LINE:  I personally don’t like casinos, I think betting is a net negative for society, and I generally don’t like gaming stocks, but I have been very interested in PLUS (and to a lesser extent, DFNN [DFNN 2.75 ?1.4%; 39% avgVol]) for a very long time for their potential to scale quickly in the digital realm in a way that we really haven’t seen before on the PSEi. I’ve covered this before, but the main benefit of PLUS running its suite of online games is that they don’t need to go through all the hassle of buying land, building a casino, setting up operations, and then running a foreign consumer-facing business to expand operations into other countries. And while the process isn’t as simple as “CTRL-C, CTRL-V” for PLUS to port its software developed for the Philippine market to Brazil (they’ll need to obviously change the language to Portuguese, among other things), they’ll be able to begin commercial operations very quickly relative to their brick-and-mortar peers. And with a way smaller risk profile. PLUS hit an all-time high yesterday on the news, after a series of all-time highs through December. Investors will be watching closely to see how effective the PLUS team is at porting its software to other jurisdictions. Any level of success can justify higher highs, especially if the team signals its interest in replicating the feat elsewhere.  

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