SkyCity Entertainment Group's stock has avoided a 15-20c hit after it was decided the NZ International Convention Centre does not need resource consent to be publicly notified, according to an expert.
Adrian Allbon, senior research analyst at Craigs Investment Partners, issued a note saying the independent planning commissioners' decision not to publicly notify the consent was positive, "particularly post the Ports of Auckland Court case, but one I think the share price was mostly [80 per cent or so] factoring in. As we have previously commented a notified outcome was probably worth 15 to 20c on the downside".
"The preliminary non-notified decision now enters a finalisation process over the coming months. The timetable for target signing of the construction deal by October is consistent with our SkyCity Auckland estimates, which have the NZICC concessions operative in 2H16," Allbon said.
Paul Turnbull of First NZ Capital also welcomed the decision.
"The notified/non-notified status of the air bridge within the preliminary design was an area of concern for SKC, however it was not raised as an issue in the planners report. The decision for the full resource application to proceed on a non-notified basis is a positive outcome for SKC and, while the likely timing of concession activation and construction remains consistent with our current forecasts, it does alleviate project risk around timing," Turnbull said.
