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19 October 2021
The Queensland border opening just before Christmas will benefit a whole bunch of stocks
Yesterday the Queensland government announced that from 17 December fully vaccinated travellers will be allowed to enter Queensland without the need to quarantine. By that stage, 80% of Queenslanders are expected to be fully vaccinated, but even if that target is not reached, the 17 December re-opening date is ‘locked in’.
Queensland reopening its borders to the rest of Australia will be beneficial for a number of ASX-listed companies. First and foremost, will be stocks related to the tourism sector, which has taken a significant hit from the border closures of the last eighteen months.
Over 28 million tourists and other visitors arrived in Queensland between July 2018 and June 2019. This total includes 2.8 million international visitors and 25.3 million domestic overnight visitors. While it may take a while for Queensland to get back to ‘normal’, we believe the fact that Queensland tourism is not heavily reliant on international tourism bodes well for the sector.
Who will benefit
We look for increased ticket sales by Qantas (ASX: QAN), which can be expected to rapidly increase its capacity to fly into Queensland.
Reef Casino Trust (ASX: RCT), which runs its namesake facility in Cairns, will be able to welcome visitors again, as will Star Entertainment Group (ASX:SGR), which has a casino on the Gold Coast in addition to its Sydney site.
Travel agents win from Queensland border opening too. Look for better business in the weeks ahead for Helloworld (ASX: HLO), Flight Centre Travel Group (ASX: FLT) and Webjet (ASX: WEB).
People may want to move to Queensland again
Queensland has not been the most business-friendly state through the pandemic, but the state traditionally makes up for that by being attractive for Australians wanting to move to a warmer climate. In the March 2021 quarter, there was a net gain for Queensland of 7,000 people from internal migration, compared with gains of 9,800 people in the previous quarter and 6,300 in the March 2020 quarter, according to ABS numbers. We think this trend will accelerate markedly in 2021, particular for people leaving lockdown-prone Victoria.
Looking ahead, we think major companies that are reliant on hiring Queensland workers will benefit from this unlocking. Have a look at ALS Ltd (ASX: ALQ), Aurizon (ASX: AZJ), Bank of Queensland (ASX: BOQ), Domino’s Pizza Enterprises (ASX: DMP), NextDC (ASX: NXT), Orocobre (ASX: ORE), Suncorp Group (ASX: SUN) and TechnologyOne (ASX: TNE).
Queensland real estate operators will benefit from the ease with which potential buyers from down south can get into the state as well. The main beneficiaries here would be Cedar Wood Properties (ASX: CWP), Sunland Group (ASX: SDG) and Tamawood (ASX: TWD).
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