Shares of Star Entertainment Group Limited (AU:SGR) have been suspended from the ASX Index today after the company failed to publish its annual results on time. This was followed by last week’s trading halt requested by the company after the state-level casino regulator, NSW Independent Casino Commission (NICC), released the second report under its inquiry. The report stated that Star Entertainment failed to address a culture of money laundering and fraud.
SGR stock has lost almost 20% of its value in the past month.
The Star Entertainment Group is a gambling and hospitality company that owns and operates prominent properties, including The Star Sydney, The Star Gold Coast, and Treasury Brisbane.
Star Entertainment Faces Investigation
Star Entertainment’s license to operate its Sydney casino was suspended in October 2022 after authorities deemed it unfit to hold a casino license. In December 2023, the company was given a six-month deadline to address certain issues and restore its license, or face possible closure.
Earlier this year, the NICC appointed lawyer Adam Bell SC to lead a second investigation into the company. This decision stemmed from concerns that the company had not adequately resolved its governance and cultural issues after significant lapses were revealed in 2022. The report criticized the management for recently addressing challenges that should have been prioritized earlier.
Star Entertainment Aims to Fix the Crisis
According to the Australian Financial Review, Star Entertainment is preparing to announce a $1.4 billion write-down of its casino assets and unveil a major cost-cutting plan. The company is also looking for refinancing so that it can sustain operations over the next six months and retain its casino license in Sydney.
Currently, it remains uncertain when Star Entertainment shares will resume trading.
What Is the Target Price for Star Entertainment Shares?
As per the consensus among analysts on TipRanks, SGR stock has been assigned a Hold rating. This is based on four Hold recommendations. The Star Entertainment share price target is AU$0.49, which is 8% above the current level.
See more SGR analyst ratings.
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