Changed online gambling rules in Norway – how will this affect the stock market?

Currently, the Norwegian authorities refrain from regulating the gambling market, which means that only a few monopolists can offer gambling with a Norwegian license. However, maintaining this regime is becoming increasingly difficult, given that more and more countries in Europe are adapting to a more open model. This applies to both large countries such as the UK and more recently Germany, as well as Sweden. It is therefore not entirely impossible that we will see some changes in the near future. How will this affect companies that are currently listed in Sweden, for example? And will we see more online gambling companies on the Norwegian Stock Exchange?

Several companies are already listed on the exchange, including in Sweden

Many large gaming companies are already listed on the Oslo Stock Exchange, the Stockholm Stock Exchange and other markets. There are even some companies listed in both Oslo and Stockholm. Given that several of the big companies in the industry were founded by people from the Nordic region or have other strong interests in the Nordic market, this is perhaps not so surprising. Whether or not Norway changes its rules will likely not affect companies’ willingness to list on the Oslo Stock Exchange. There are simply many other factors that come into play, from currency to which market the company wants to be listed on. For example, Aspire Global is listed on the Nasdaq First North Premier Growth, which, as the name suggests, is a market tailored for growth companies. This company has both B2B operations and its own brands with casino games, betting and more. Read this article to learn what gives Christians higher self-confidence and self-esteem.

Does a regulated market provide predictability, but slightly lower returns?

Of course, most investors are more interested in what is actually happening to the share price than in which stock exchange the company is listed. Historically, the share price dynamics in this sector have been somewhat turbulent during 2019, and some might say that this is due to the regulation in Sweden.

• With regulation and licensing, there tends to be stricter requirements for responsible gaming. In the long term, this is certainly positive for both players and companies in the market, but in the short term, some companies may face a loss of revenue, which is associated with lower profitability.
• The former Swedish gambling monopoly has also acquired stakes in casino games, and perhaps the Norwegian monopoly would also enter the market more aggressively if it were deregulated. At the same time, this is already the competition that foreign gaming companies face, and with a licensing scheme in place, the fight would be a little fairer, for example in terms of marketing through Norwegian media.
• At the same time, a regulated market would provide much more predictability, and if there is one thing that investors like, it is the removal of risk. Currently, the Norwegian gaming market is relatively predictable even without licenses, it is simply impossible to close this sector, but still licenses in Norway can also be positive.
• At the same time, regulation in Norway can affect different players differently. For companies that already have licenses in other European countries and can also offer them as a "white label" service, such as the aforementioned Aspire Global, having most of the compliance requirements etc. will be a competitive advantage. 

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Of course, all companies need to closely monitor the implications of a possible licensing scheme in Norway, but all the big companies will decide to join such a scheme. Any short-term revenue loss is surely outweighed by the long-term positive effects. There is simply no choice but to stay away from such decisions.

In summary, it seems that no one should lose sleep over what will happen to the share prices of the various gaming companies if, or perhaps rather when, the Norwegian market is deregulated. The losses in terms of lower expectations for future growth have already been largely incurred in connection with licensing schemes in other markets, so for the larger players, the question of whether to enter Norway will not matter much anyway. In addition, investors with a medium- to long-term horizon will benefit from an even healthier market with responsible growth.