PETALING JAYA: The opening of the new Genting Casino at Resorts World Genting is positive for Genting Malaysia Bhd
(GENM) even though it is less than 10% of the total capacity when the Circus Palace and Hollywood mass gaming floors were operating.
Maybank Investment Bank Research (Maybank IB Research) said it saw no immediate need to revise its earnings forecasts at this juncture.
For Maybank IB Research to do so, the Circus Palace and Hollywood mass gaming floors would also have to fully reopen.
This would raise its earnings forecasts by about 20% a year and discounted cash flow target price by 8% to RM2.95 a share.
The research house said continued to believe GENM is deep in value and thus, maintained its “buy” call on the stock at a target price of RM2.73 a share.
The key risks cited for its call were more related-party transactions involving Empire Resorts and a negative outcome from a US$600mil lawsuit by RAV Bahamas.
After GENM’s third quarter 2024 financial results, the research house said it cut its long-term mass-market gross gaming revenue forecasts by 25% to RM2.8bil to RM2.9bil a year due to the delayed reopening of the Circus Palace and Hollywood mass gaming floors in at Resorts World Genting.
The research house visited Resorts World Genting on Dec 30, 2024 after hearing talk that the Circus Palace and Hollywood mass gaming floors had reopened. They have been closed for renovation since February 2024.
The research house said both mass gaming floors remain closed with renovations underway. GENM said they would reopen eventually but a date had not yet been set.
