GGRAsia – Maybank cuts Resorts World Genting 2022 visitor tally 13pct

Maybank cuts Resorts World Genting 2022 visitor tally 13pct

May 06, 2022 Newsdesk Latest News, Rest of Asia, Top of the deck

Maybank Investment Bank Bhd is cutting by 12.5 percent its estimate for 2022 visitor numbers at Malaysia’s only casino complex, Resorts World Genting (pictured), it said in a Friday note.

“We understand that business at Resorts World Genting slowed from March 2022 due to the Omicron wave” of Covid-19 in the country, said analyst Samuel Yin Shao Yang.

The complex in an upland area outside the Malaysian capital, Kuala Lumpur, had been operating only circa 5,000 of its 10,000 rooms, coinciding with those circumstances, added the analyst.

“We cut 2022 Resorts World Genting visitor arrivals to 21 million (3 million hotel guests and 18 million day trippers) from 24 million (6 million hotel guests and 18 million day trippers),” on the assumption of the property “operating circa 5,000 rooms in 2022,” wrote Mr Yin.

He added Maybank was also cutting its 2022 forecast for earnings per share at the complex’s operator, Genting Malaysia Bhd, “by 40 percent”.

Such performance forecast was despite Malaysia’s prime minister, Ismail Sabri Yaakob, saying in March the country was admitting international travellers from April 1, as it moved to an ‘endemic’ rather than pandemic phase of the Covid-19 crisis, amid a high local rate of vaccination against the disease.

The institution nonetheless expects Resorts World Genting to reopen all its hotel rooms from 2023 onwards, coinciding with what Maybank expects will be a falling volume of new Covid-19 cases.

Regarding the present outlook for Resorts World Genting’s VIP gambling business, Mr Yin stated “channel checks” suggested “few Malaysian VIPs are flying to Singapore, Phnom Penh [Cambodia] and Manila [the Philippines] to gamble relative to pre-Covid-19 levels.”

He added: “We gather that Malaysian VIPs are rebuilding their businesses,” following pandemic-related disruption, and a “weak” Malaysian currency, the ringgit was “discouraging overseas travel”.

Genting Malaysia reported in February a profit for the fourth quarter of 2021, compared to a loss a year earlier. It said the improvement was mainly driven by its venues in markets outside Asia, that had reopened more quickly.

The whole of Resorts World Genting was temporarily shut for four months last year, before being allowed to reopen on September 30.