RHB Research has maintained a” Buy” for Genting at a TP of RM3.58, upside, and c.6% yield as it is a direct proxy for investors to ride on the tourism recovery angle play
It said that the valuation is inexpensive, at 7.3x FY22F EV/EBITDA compared to the regional peer average of c.13x. “Further upside could come from ER’s ongoing turnaround, especially when New York state mobile sportsbook’s GGR is showing promising growth week-on-week,” RHB said.
It said that South-East Asia’s most anticipated theme park will finally open its doors on 8 Feb. Genting SkyWorlds will accelerate Genting Malaysia’s business recovery trend as it should be a crowd-puller, and provide a new income stream while also benefitting other facilities within Resorts World Genting (RWG). It said that it continues to like the stock as a direct beneficiary of tourism recovery play.
The research house said that it understands that RWG’s overall business recovery in 4Q21 was strong despite some slight disruption from the Dec 2021 landslide. Even though the crowd at SkyAvenue during our recent site visit (27 Jan) was visibly lesser, this could be due to it being a weekday.