MAYBANK Investment Bank Research has kept “buy” call on Genting Malaysia Bhd, with an unchanged target price of RM4.74.
Maybank IB said Resorts World Genting (RWG) visitor arrivals may continue to be weak due to the construction and renovation works under the Genting Integrated Tourism Plan (GITP).
The firm, however, is convinced that the number will rebound strongly once GITP is completed.
The 1,300-room new hotel under the GITP is due to open by June next year, Maybank IBsaid, adding that Genting Malaysia is also bidding for a casino in New York, United States.
The firm said it is impressed with Genting Malaysia’s latest interim results, although RWG visitor arrivals fell 15 per cent year-on-year (y-o-y).
“The group’s first quarter RWG revenue still grew by one per cent y-o-y. This indicates that
y-o-y growth in revenue per visitor has compensated for y-o-y contraction in visitor arrivals and casino patrons,” Maybank IB said.
The firm said Genting Malaysia’s core net profit in the first quarter this year (1Q14) of RM361.3 million was within expectations at 22 per cent of its full-year estimate.
“1Q14 revenue of RM2 billion was within expectations at 23 per cent of our full-year estimate. No dividends were declared in 1Q14 but this was expected,” Maybank IB added.
