Dynam Japan, the largest pachinko hall operator in Japan in terms of number of halls, plans to open no fewer than 40 annually to further extend its nationwide network. The Hong Kong-listed company operated 365 halls as of last month, with 10 more to come by the end of March next year, said chief executive Kohei Sato. Pachinko business is a highly fragmented industry in Japan, with 3,795 operators, according to statistics from the Yano Research Institute. Dynam said its target was to have 1,000 halls in 10 years. Dynam said it had been focusing on low-playing-cost halls because the number of high speculative players who could keep up with high-playing costs had been decreasing. The trend is clear, with the number of low-playing-cost machines increasing from 8.7 per cent in December 2007 to 80.8 per cent by the end of last year. Dynam is the sole cornerstone investor in the initial public offering of casino-hotel operator Macau Legend in June, with a US$35 million stake. The company said it planned to set up the next generation pachinko machines in Macau. Pachinko is a game akin to vertical pinballs but the next generation will be digitalised machines without physical pin balls. Macau has had no pachinko business until now and the operation is still pending approval from the government. Chairman Yoji Sato said the company would focus on the Japanese gaming market in the future. Facing a series of challenges including an ageing society and shrinking economy, a number of Japanese cities such as Tokyo and Osaka have expressed interest in setting up casinos to generate tax revenues and draw tourists. But so far gaming has remained illegal in the country. Dynam has said that once gaming operations became legal in Japan, it would like to tap into the market and is looking for partners. "There are operators in Macau and Las Vegas that are interested in lining up with us. But a decision is yet to be made," said the company's chairman. Dynam reported a gain of 6.5 per cent in net profit to HK$784 million for the six months to September. Its shares have gained 31.7 per cent this year, compared with a 5 per cent rise in the Hang Seng Index.