Equity Raise Shores Up the Balance Sheet as Tabcorp Eyes Coronavirus Recovery

Tabcorp operates three segments. The ostensible spread belies the fact that the wagering (providing betting services) and media (providing racing pictures to complement betting services) division generates more than a third of the group's earnings. The wagering business consists of state-based, licensed monopolies to offer off-course totalisator and fixed-odds wagering in a retail environment in Victoria and New South Wales on thoroughbred and greyhound racing, as well as live sporting events. The merger with Tatts during 2017 has seen Queensland, South Australia, Tasmania, and the Northern Territory added to the list, and we believe the combined entity will be substantially better placed to meet the growing competition that traditional brick-and-mortar wagering is facing from digital-only competitors. This certainly justifies our narrow moat rating on Tabcorp.