DigiPlus shares fall 20% amid online gambling ban worries

MANILA, Philippines — DigiPlus Interactive Corp. emerged as the biggest loser in the stock market on Wednesday as it suffered one of its worst bloodbaths in history amid snowballing calls for online gambling ban.

The former stock market darling dove by 20.4 percent to P27.90 each as investors took cover.

This represents its second-worst single-day plunge after its 23.87-percent free fall on July 4. That was days after Sen. Sherwin Gatchalian filed a bill proposing strict regulations on the rapidly growing online gaming sector.

“The drop in the share price of [DigiPlus] was driven by rising calls for an outright ban on online gambling,” Alfred Benjamin Garcia, research head at AP Securities Inc., said in a text message.

Malacañang on Tuesday confirmed that President Marcos was “thoroughly” studying a ban on online gambling.

READ: Marcos studying ‘thoroughly’ outcome of a ban on online gambling

Sen. Raffy Tulfo also recently joined other lawmakers in calling for an outright ban, saying that the country had “an epidemic of gambling.”

READ: Raffy Tulfo: Probe, sanction gov’t officials linked to online gambling

Free fall despite buyback program

The share price of DigiPlus, which operates BingoPlus, ArenaPlus and Color Game, among many others, has fallen by 57.3 percent from its 52-week high of P65.3 on June 11.

DigiPlus’ steep tumble from its peak came a week after it launched a P6-billion share buyback program in hopes of plugging the heavy bleeding.

Analysts earlier said that this could give it a “much-needed confidence boost.” They also warned, however, that should the strict regulations be signed into law, DigiPlus’ domestic operations may be battered the most.

Still, they said the company’s upcoming Brazil launch is seen to soften the impact of the proposed law.

READ: Digiplus all set for September debut in Brazil

DigiPlus more than doubled its profit in the first quarter of the year to P4.2 billion thanks to its flagship games that continued to attract patrons.

This is higher than the P3.3 billion of Bloomberry Resorts Corp., which operates the brick-and-mortar Solaire casinos and has explicitly expressed its interest in competing with DigiPlus.