With a potential GGR at maturity of between $250m-$300m, Kentucky is expected to be the 15th largest out of the current slate of 28 OSB states. The legislation appears to allow for a launch in January 2024, adding 1.4% of the US population to the potential sports-betting TAM. The comparatively low tax rates of 9.75% for retail and 14.25% for mobile are expected to draw considerable interest from digital operators. FanDuel and DraftKings are predicted to be in prime position to pick up early market share leadership due to the existing fantasy sports market in Kentucky, while Churchill Downs is likely to benefit from the retail betting opportunity and the potential of selling the three skins it will receive as part of the legislation. JMP suggests the new launch will see deeper initial investment, faster user adoption rates, and high initial returns compared to previous state launches, similar to Ohio’s experience. The launch is expected to result in a modest reduction of EBITDA across the board, but not impacting full-year profitability outlooks for the tier one and two online operators.