Korea’s leading foreigner-only casino operator Paradise Co attracted orders for its corporate bonds of more than three times its planned issuance as the investment community showed strong confidence in the company’s trajectory.
However, the take-up was far more pronounced for 2-year bonds than 3-year bonds, highlighting concerns around the direction of interest rates and the expectation that Paradise may need to borrow more for ongoing capex projects, according to analysts.
Based on information released this week, Paradise had planned a KRW60 billion (US$44.8 million) corporate bond issuance but received orders totalling KRW205 billion (US$153 million). Of those, KRW149 billion (US$111 million) of orders were for 2-year bonds and KRW56 billion (US$41.8 million) for 3-year bonds.
Paradise is reportedly considering increasing its bond issue from KRW60 billion to KRW100 billion (US$74.6 million).
Analysts noted that the 2-year tranche was priced 1 basis point below the company’s market valuation rate while the 3-year-bonds were priced 27 basis points above – suggesting Paradise needed to offer more for the 3-year bonds to drive demand.
The bonds are to be used to pay down existing debt.
Paradise has enjoyed a prolonged surge over the past 18 months and set new all-time revenue records for the month of August and for the September 2026 quarter.
However, it has also announced a variety of capex initiatives, including the construction of a new all-suite hotel in Seoul, scheduled to open in 2028.
On the bond issuance, NH Investment & Securities analyst Choi Seong-jong said, “Caution regarding the future direction of interest rates is driving a preference for short-term bonds. I believe the pricing also reflects concerns about the potential for increased borrowing by Paradise.”
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