Genting Sing

Thailand is in its way to legalise casino

The CEO of Las Vegas Sands has expressed a keen interest in establishing a casino presence in Thailand. Analysts predict that the inaugural casino in Thailand could materialize by 2029. Las Vegas Sands, a distinguished integrated resort enterprise, boasts ownership of Marina Bay Sands in Singapore. Should this venture materialize, it is anticipated to significantly bolster tourist influx into Thailand, particularly from China. This, in turn, could indirectly impact Malaysia's tourism sector, particularly affecting $GENM / 4715 (GENTING MALAYSIA BERHAD). Notably, Genting's casinos are perceived as less advanced compared to counterparts in Singapore and Cambodia, attributed partly to governmental policies.

Thailand's government has proposed a favorable tax rate of 17% on gross gaming revenue (GGR) to allure investors, contrasting with Malaysia's 35% and Singapore's 22%. Bloomberg reports that $SGX-G13, MGM, and Galaxy Entertainment have expressed interest in establishing a casino presence in Thailand. Should Genting Singapore successfully secure this endeavor, it would benefit $GENTING / 3182 (GENTING BERHAD), given its significant shareholding in Singapore. However, it's noteworthy that regardless of the bidding outcome, one company stands to gain— $RGB / 0037 (RGB INTERNATIONAL BHD).

All those who catch the bottom, congrats to you. I do believe the current gov would ease the licensing in Malaysia and hopefully, would inject more income to Malaysia.

Am equally happy as the money rotation to spur the economy would be there. Sadly, Malaysia's Genting out because Macao's 6 casino operators get new licences,

Reading
https://cutt.ly/K1kAAUM

$GENTING / 3182 (GENTING BERHAD) $SGX-G13 $GENM / 4715 (GENTING MALAYSIA BERHAD)

Genting Singapore $SGX-G13
Research by Maybank
Neutral (From Add) - Target Price SGD 0.86

"Fundamentals improving but likely reflected in share price"

1H22 results disappointed on low VIP win rate. That said, the higher margin mass market is recovering quickly. Going forward, GENS expects future earnings to be better. Trim FY22E earnings by 15% but long term earnings little changed. Reflecting GENS’ optimism, we reduce our WACC to 11.0% from 11.6% as we lower our Beta to 1.3x from 1.4x. Even though this tweaks our DCF-based TP to SGD0.86 from SGD0.85, upside has narrowed to <10%. Downgrade GENS to HOLD from BUY.

Analyst(s):
Yin Shao Yang
samuel.y@maybank-ib.com

Genting Singapore $SGX-G13
Research by HLIB
Hold (Maintained) - Target Price SGD 0.81

"Recovering slower-than-anticipated"

GenS reported 1H22 core net profit of SGD103m (+68.8% YoY), which was below our expectation accounting for 38.5% of our full-year forecast. The negative deviation was due to lower-than-expected contribution from gaming segment as a result of (i) lower hold percentage; and (ii) limited operating capacity as a result of labour shortage. We lower our FY22/23/24 forecasts by -14.2%/-7.2%/-1.3% to factor in the results shortfall for the quarter as well as lower operating capacity assumptions. Maintain HOLD with a higher TP of SGD0.81 (from SGD0.76) based on 9x of FY23 EV/EBITDA (rolled over from mid-FY23).

Analyst(s):
Tan Kai Shuen, CFA
kstan@hlib.hongleong.com.my

@Ryunanda agree that $GENTING / 3182 (GENTING BERHAD) is better relatively as it has other business that are running in profit like $SGX-G13 and $GENP / 2291 (GENTING PLANTATIONS BERHAD) for example. Thank to the dip, manage to buy early of the year at low price. Looking it to go back to RM10 :rocket::rocket::rocket:

@eugenekua @Jay888 what about $GENTING / 3182 (GENTING BERHAD)? I would think thats a less riskier play due to the fact that it's more "global" and thus diversified?

Malaysia side via $GENM / 4715 (GENTING MALAYSIA BERHAD) contributes around 40% to the group - which is not yet fully running due to Malaysia's sporadic MCO / CMCO, but $SGX-G13 Singapore is up and running, Furthermore the Genting’s US$4.3b Las Vegas bet is due for summer launch and their aggressive marketing signals high conviction that the Vegas market will rebound.

Just a thought, I might be wrong.

Genting Singapore $SGX-G13
Research by HLIB
HOLD (Maintain): Target Price: SGD0.85

“Satisfactory performance”

GenS reported 4QFY20 core net profit of SGD81.0m (+10.7% QoQ, -54.0% YoY), bringing 12MFY20’s sum to SGD90.8m (-87.1% YoY). The results were above our and consensus’ expectations constituting 130%/178% of our/consensus forecasts due to higher than expected gaming volumes generated from local gamblers as Singapore continues to record low daily Covid-19 cases. 12MFY20 EI sum of -SGD21.6m was stripped off largely comprising of impairments carried out in 2QFY20. We remain cautious on the prospects of GenS despite its stronger than expected performance as Singapore’s stringent travelling restrictions is expected to deter foreign gamblers from entering the country. Nevertheless, we maintain our HOLD call at a higher target price of SGD0.85 based on FY21 EV/EBITDA multiple of 8x (from 7x previously).

Low Jin Wu
T (603) 2083 1711
E jwlow@hlib.hongleong.com.my

Genting Singapore $SGX-G13
Research by HLIB
HOLD(Maintain): Target Price: SGD 0.77

“Stronger than anticipated”

GenS reported 3QFY20 core net profit of SGD73.2m (from -SGD116.5m QoQ, - 52.9% YoY), bringing 9MFY20 core net profit to SGD9.8m (-98.1% YoY). The results were very much above expectations largely due to higher than expected gaming volumes generated from local gamblers. 9MFY20 EI sum of -SGD72m was stripped off largely comprising of impairments carried out in 2QFY20. We now forecast FY20 to record a net profit of SGD69.9m (from a net loss of -SGD207.5) as we impute higher gaming volumes. Maintain HOLD with a higher TP of SGD0.77.

Andrew Lim Ken-Wern
T 603 2083 1730
E kwlim@hlib.hongleong.com.my

Genting Singapore $SGX-G13
Research by HLIB
HOLD (Maintained): Target Price;SGD0.75

"Broken by the Circuit Breaker"

GenS’ 1HFY20 core net loss of -SGD63.3m (from SGD373.8m YoY) is below ours and consensus expectations due to larger than expected losses incurred in 2QFY20 from the Circuit Breaker and the expectation of a weak recovery 2HFY20. Despite the resumption of the operations in RWS, footfall remains weak given the ongoing scare of Covid-19 coupled with limited operating capacity at attractions and casino. GenS will continue carrying out cost rationalisation efforts to mitigate the losses expected to be incurred. We now estimate FY20 to record losses of -SGD207.5m and lower our FY21/22 earnings by -36.9%/11.6% as we impute a slower recovery moving forward given the uncertainty of Covid-19. Maintain HOLD with a lower TP of SGD0.75 (from SGD0.79) based on an EV/EBITDA multiple of 7x.

AndrewLimKen-Wern
+603 2083 1730
kwlim@hlib.hongleong.com.my

Genting Singapore $SGX-G13
Research by HLG
BUY (Maintain); Target Price SGD1.14

"The race for Osaka becomes tighter "

GenS’ 3Q19 core net profit of SGD155.2m (-6.5% QoQ, -26.5% YoY) was below our expectations largely due to higher than expected depreciation costs coupled with our expectation of 3Q to perform seasonally stronger. No dividends were declared. We gather that there are approximately 3 operators left in the run for the Osaka bid (MGM Resorts, GenS, and Galaxy Entertainment) from the initial 7 operators which registered. We lower our earnings by -6.1%/- 7.7%/-6.8% as we impute higher depreciation expense. Maintain BUY with a lower TP of SGD1.14 (from SGD1.17) based on a FY19 EV/EBITDA multiple of 9x .

Andrew Lim Ken-Wern
kwlim@hlib.hongleong.com.my
(603) 2083 1730

Good question @wsk20... I think the stock will remain sideways in the near term until there's clarity on the opening date of Genting Malaysa's themepark.

I believe the overhang from $GENTING / 3182 (GENTING BERHAD) has had alot of link to $GENM / 4715 (GENTING MALAYSIA BERHAD). The key issue is the actual launch date of the theme park "The Group expects to roll out the much anticipated Twentieth Century Fox World Theme Park as well as the new indoor theme park in 2018" however many are suggesting that it could be delayed.

Another overhang is the possible introduction of gaming tax. With the Malaysia debt according to new finance minister are like in trillions, this is an easy target to plug that hole.

With that in mind, these are the catalyst on how the share price can move upwards:

1) NAV Discount below the mean discount for the year. According to my personal calculation on the company's of discount to NAV, it's currently hovering at 12 months low and is 7% below its mean discount to NAV for the year.

2) Genting Singapore $SGX-G13 had 20% increase in Q1 18 earnings had its FY 18E earnings lifted up too.

3) Genting Malaysia is undervalued! and that once their theme park is finally finished (after masive cost and time overrun), the real earnings power of this company will be significantly higher.

Overall, I think Genting is a good medium term investment. The share should show its true colors in 2019.