RHB Research has maintained a “Buy” recommendation for Genting Bhd with a target price of RM6.37, 22% upside, and 4% yield.
It said that Genting’s 20.3%-owned pharmaceutical company TauRx has completed the Phase 3 clinical trial (LUCIDITY) of its Alzheimer’s treatment, HMTM, and is moving towards regulatory submission.
It said that it does want to make changes to our earnings forecasts and SOP TP of MYR6.37, which includes a 14% ESG discount. We chose to not include TauRx in GENT’s SOP for now, pending greater clarity on its valuations. “Nevertheless, we maintain our BUY call for its attractive 6.4x FY23F EV/EBITDA valuation vs regional peers’ 11x average,” it said
It said the stockbroking house said that it was positive about this development, as it marks a step forward for TauRx to potentially bring HMTM to the market, providing greater visibility to its path to profitability.
The stockbroking house said that it believes that Street, like us, has yet to factor TauRx into GENT’s valuations, there is upside to the consensus TP.
