The Genting group’s casino operations in Asia – namely in Singapore and Malaysia – are likely to benefit in 2024 from what Maybank Investment Bank Bhd calls the “en masse return of Chinese tourists”.
Maybank’s analyst Samuel Yin Shao Yang added that the Genting group – via Genting Singapore Ltd –“may jointly bid for a Thai integrated resort (IR) licence should Thailand liberalise its IR industry”.
Thailand’s House of Representatives – the lower chamber in the National Assembly – voted in October last year to set up a 60-member committee to look into the possibility of legalising casino complexes in the nation, reported local media outlets at the time.
Mr Yin said that Genting Singapore had previously shown it was “not averse to expanding overseas to partially stave of competition”. He noted that the firm had previously been linked to potential interest to expand into Jeju in South Korea, and had also been a potential partner for metropolis Yokohama regarding a bid for one of Japan’s casino licences, until the city’s authorities decided to drop out of contention for the first-round tendering process.
Looking into 2024, Mr Yin said Maybank expected a resumption of outbound Chinese tourism post-Covid-19 would benefit Genting group’s gaming operations around Asia. He added – in a note issued on Saturday – that such trend could drive business growth at Genting Singapore’s Resorts World Sentosa casino property (pictured in a file photo), “as seat capacity for flights from China to Singapore recovers”.
“Despite higher tax rates, we expect earnings to recover to pre-Covid-19 levels this year thanks to higher than pre-Covid-19 gaming revenues,” Mr Yin said, referring to Genting Singapore. “We expect most of the growth in gaming revenue this year to come from Chinese tourists.”
The analyst noted that the Singaporean authorities had recently introduced a policy granting 30-days visa free entry to Chinese visitors. “Thus, we hope that Chinese visitation to Resorts World Sentosa will recover completely [to pre-Covid levels] this year.”
He said: “In the long term, we expect Resorts World Sentosa’s VIP volume and mass market gross gaming revenue to exceed 2019 levels by circa 20 percent”.
In a separate Saturday note on Genting Malaysia Bhd, Maybank forecast that visitor arrivals to the firm’s Resorts World Genting – Malaysia’s sole casino resort – “ought to recover to pre-Covid-19 levels this year”.
Mr Yin said: “This will drive full-year 2024 earnings to recover 60-percent year-on-year and enable Genting Malaysia to offer dividend yields equal or above 5.4 percent per annum.”
A potentially positive catalyst for Genting Malaysia this year would be the firm securing a downstate commercial casino licence in the state of New York, in the United Sates, said Maybank.
The New York State Gaming Commission in January last year launched a request for applications process for three downstate New York gaming licences.
Mr Yin noted that Chinese visitor arrivals to Resorts World Genting had yet to recover to pre-Covid levels. The analyst said Maybank expected air connectivity between Malaysia and China would be “fully restored this year”, leading to a recovery in the number of Chinese visiting Resorts World Genting.
“It also helps that Malaysia recently granted 30-days visa free entry to Chinese visitors,” he added.
