GGRAsia – Singapore Covid-19 easing positive for RWS: Maybank

Singapore Covid-19 easing positive for RWS: Maybank

Dec 15, 2020 Newsdesk Latest News, Singapore, Top of the deck

Resorts World Sentosa (RWS), one half of Singapore’s casino duopoly, is likely to have seen sequential improvement in its fourth-quarter earnings, as Singapore continues to manage its way out of the pandemic crisis, says a Tuesday note from Maybank Investment Bank Bhd.

Singapore announced on Monday it would move to “phase three” of its easing from its so-called “circuit breaker” measures starting on December 28, which will have an impact on public attractions and could also assist the duopoly’s outlook into the first quarter next year. Marina Bay Sands, run by a unit of United States-based Las Vegas Sands Corp, is the other half of the duopoly .

Phase three involves further easing in size of social gathering allowed, as well as easing of operational capacity for shopping malls and attractions. The latter will be allowed to operate at a capacity of up to 65 percent, compared to the current 50 percent, although the Singapore government doesn’t specify whether the term “attractions” also covers to the country’s two casino resorts.

The phase three reopening measures should nonetheless be a “positive” for Genting Singapore Ltd, the operator of Resorts World Sentosa (pictured), said Maybank analyst Samuel Yin Shao Yang in a Tuesday memo The note suggested that Genting Singapore’s third-quarter “outperformance” had come despite a 25 percent operating capacity during that reporting period.

“Attractions were allowed to increase operating capacity to 50 percent from 25 percent from September 18, 2020 onwards. Resorts World Sentosa casino was also open to all guests from October 9, 2020 onwards (previously only to Genting Rewards members). Thus, fourth-quarter 2020 earnings ought to be better quarter-on-quarter,” the Maybank analyst stated, noting that integrated resorts are also a type of attraction.

In a speech delivered on Monday afternoon, Singapore’s prime minister, Lee Hsien Loong, said that the city-state would have “enough vaccines for everyone” by the third quarter of 2021, in relation to protection against Covid-19. Vaccinations will be voluntary and free for all Singapore residents, according to Mr Lee in his address.

A notice from the country’s Ministry of Health clarified that such vaccine would be made available to Singapore citizens, permanent residents and long-term work-permit holders.

The prime minister also noted in his speech that Singapore would reopen its borders in a “controlled and safe way”, despite the fact that was likely to mean the city-state would see further imported cases of Covid-19 infection. It was a “calculated risk” that Singapore had to accept, Mr Lee said in his address.

Maybank stated: “Singapore aims to vaccinate its entire population by end-2021. This will instill confidence in Singaporeans to visit Resorts World Sentosa again. We gather that they accounted for approximately 20 percent/50 percent of pre-Covid 19 VIP/mass market gross gaming revenue (GGR).”

“Prime minister Lee also stated that Singapore will gradually reopen its borders. This is important as we gather that Chinese, Malaysians and Indonesians accounted for approximately 80 percent/50 percent of pre-Covid 19 VIP/mass market GGR,” analyst Mr Yin noted.