Shares of Genting Singapore extended a more than month long rally as Japan took another step toward legalizing casinos.
The stock was up 2.55 percent at 1.005 Singapore dollars ($0.71) at 9:48 a.m. HK/SIN, totting up a nearly 35 percent gain since the beginning of November as Japan's legislative push gained steam.
The lower house of Japan's parliament voted Tuesday in favor of legislation to promote casinos, sending it to the upper house, which will begin deliberations on the bill on Wednesday, where it was expected to quickly pass. It's the culmination of years of efforts, with Prime Minister Shinzo Abe advocating for the measure since taking office in 2012.
That's despite newspaper polls finding a majority of Japanese oppose legalizing casinos.
Genting Singapore, or GENS, which operates one of Singapore's two integrated casino-resorts, has long been touted as a likely beneficiary, standing ready to enter the Japanese market.
Countries across Asia have eyed Singapore's integrated casino-resort model as a template for allowing casino gaming as it can help to attract a larger variety of tourists than merely gamblers.
Kotaro Tamura, a Milken Institute Asia Fellow and a former senator and parliamentary secretary in charge of economic and fiscal policy in Japan's Cabinet Office, told CNBC on Wednesday that the aim of an integrated resort wasn't to make money from the casinos.
He said the bill would likely increase the number of visitors to Japan as well as bring in more, higher-spending tourists.
"We try to improve the quality of the tourists, quality of the travelers to Japan. Not only numbers," he told CNBC's "The Rundown," on Wednesday. "Japan now has finally found that as a tourist destination we have everything: culture, nature, food, climate, security, hygiene and infrastructure."
Because tourism is a key growth strategy for the country, the economic benefits from the integrated-resorts bill will be sizable, he added.
Nomura noted that GENS was likely to step up if Japan opens up to casinos.
"We believe GENS will actively bid for the integrated-resort development in Japan, if the bill passes," Nomura said in a note on Tuesday, although it noted that competition was likely to be intense. "We think the potential upside of the legalization of casinos in Japan will be material to GENS, provided it is selected as one of the developers."
Nomura kept a "neutral" call on the stock, with a target of S$0.85, citing uncertainty over whether GENS will receive a nod from Japan.
GENS has made sure it's ready once the sites are up for bid: In mid-November, it unexpectedly disposed of a 50 percent stake in a casino venture in South Korea's Jeju.
"GENS has cited potential passing of the Japan integrated resorts bill as one of its main reasons to sell its Jeju casino stake and get back S$588 million ($413.60 million) of capital," Deutsche Bank said in a note in mid-November.
Deutsche Bank noted that the Japan project, with estimated capital expenditure of 5.6 billion Singapore dollars, would likely have cheaper financing options in low-yielding Japan.
It upgraded GENS stock to "buy" from "hold" and raised its target to S$1.20 from S$0.80.
Citigroup was positive on GENS' decision to pull up stakes in South Korea and head to Japan.
"We were never optimistic about the Jeju JV's economic return, knowing that the casino will be foreigners-only and the Chinese government has been warning foreign casinos over the last year or so that casino marketing is illegal in China," Citigroup said in a mid-November note.
"We think resources reallocated to Japan could yield more promising return to Genting (if casino gaming is legalized and GENS wins a license)," it said.
Citigroup noted that the Japanese market would likely become the second-largest gaming market in the world after Macau and would likely be dominated by local players. It rated the stock at "buy" with a S$1.00 target.
GENS has long sought ventures outside of Singapore as gaming revenue there has stagnated amid a small home market and an economic slowdown in the broader region. It has also faced headwinds as Chinese gamblers began to keep a low profile amid a corruption crackdown on the mainland.
Other potential beneficiaries of casino legalization had more muted reactions.
In a note Tuesday, Daiwa flagged H.I.S., Fuji Media, Tokyotokeiba and Resorttrust as operators whose fortunes may improve thanks to Japanese legislation.
"Each of these names would benefit indirectly if a casino is located near its core operations," Daiwa said.
Tokyotokeiba was down 0.71 percent respectively at 10:21 a.m. HK/SIN, but it was up more than 35 percent since the beginning of November.
Resorttrust was down 1.09 percent at 10:21 a.m. HK/SIN, and it had eked out a gain of only around 3.5 percent since the beginning of November.
Fuji Media rose 0.94 percent by 10:25 a.m. HK/SIN, totting up a rally of a little more than 11 percent since the start of November.
Travel operator H.I.S. was up 1.74 percent by 10:26 a.m. HK/SIN, for a rally of around 12 percent since the start of November.
—By CNBC.Com's Leslie Shaffer; Follow her on Twitter