Genting Plantation scored its best quarterly results in years, Maybank IB its market analysis has Maintained a BUY call with higher TP of MYR5.49, and results beat its expectations on better-than-expected RWS VIP volume and Meizhou Wan contributions.
3Q23 core net profit was the highest since 4Q19. Going forward, the house believes that the earnings outlook for GENT’s major segments is bright. RWLV also appears to have found its footing with another record EBITDA of USD52m in 3Q23. On closer inspection, the earnings outperformance was due to 3Q23 RWS VIP gross gaming revenue surging c.35% QoQ to SGD361m in top-line contribution, or 75% higher than we expected and 49%-owned Meizhou Wan IPP contributing c.MYR95m in 3Q23 and c.MYR115m in 9M23 on less volatile coal prices, when Maybank IB had expected it to only breakeven.
In 3Q23, RWG benefitted from locals spending more per pax, RWS benefitted from more tourists and RWLV operations continued to ramp up with a new EBITDA high of USD52m. Going into 4Q23, the house expects RWG and RWS to benefit from seasonally higher visitation. RWLV also benefitted from the recently concluded Las Vegas Grand Prix. On Meizhou Wan, GENT expects it to deliver a stronger performance thanks to more stable coal and inventories as well as higher demand for electricity.
Following the higher/lower earnings estimates and imputing MYR200m of contributions from Meizhou Wan p.a. going forward Maybank IB raises FY23E/FY24E/FY25E EPS by 37%/15%/ 11%.
