PH Resorts Group Holdings, Inc. (PHR) is in the process of raising 756 Million Pesos of fresh capital through a follow-on offering. Fresh funds will be used to jumpstart construction of PHR’s casino resort in Mactan island, Cebu.
PHR is a start-up in the resort and hospitality industry. As a start-up it needs the funds to build its business. PHR’s only operating asset as of the moment is the Donatela Hotel located at the resort town of Panglao in the Province of Bohol. Typical of a start-up is the limited or negative cash from operations.
The funds that will be raised from the follow-on offering will just be a drop in the bucket. It will have to raise more funds as PH Resort builds its businesses. The group of Dennis Uy, PHR’s principal stockholder has already sunk-in advances and deposits for future stock subscription of 5.8 Billion Pesos to PHR.
Critical to PHR right now is that it must be able to convert its short-term loan of around 6 Billion to long-term loans.
PHR at 1.68 a share is a good bet. PHR offers plenty of room for an upside with enough significant risk for a downside. If PHR weathers the storm and can finish the casino resort in Mactan then reward is up to the moon.
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Disclaimer and Disclosure: This is an independent analysis for discussion purposes with the aim of giving stock traders and investors an independent viewpoint. Accuretti Systems Inc. in day to day trading may have owned, or is considering buying or disposing, the shares of the companies mentioned in this commentary.