Genting Singapore - OCBC Investment 2020-11-17: Strong Recovery, Positive Sentiment Boost; Upgrade To BUY

GENTING SINGAPORE LIMITED (SGX:G13) | SGinvestors.io GENTING SINGAPORE LIMITED (SGX:G13)

Genting Singapore - Strong Recovery, Positive Sentiment Boost

  • Stronger-than-expected recovery.
  • Genting Singapore's EBITDA and net profit back in the black in 3Q.
  • Higher fair value estimate of S$0.96.



Genting Singapore's 3Q20 performance beat expectations

  • Genting Singapore (SGX:G13)’s provided its 3Q20 business update. Revenue fell 50% y-o-y to S$301.0m, but improved over 100% on a q-o-q basis, driven by a strong recovery across all key business segments (3180% q-o-q for gaming, 269% q-o-q for non-gaming and 52% for others).
  • Despite travel restrictions and capacity constraints, Genting Singapore's 3Q20 adjusted EBITDA swung back into a profit of S$149.0m (-46% y-o-y) from a loss of S$84.9m in 2Q. The performance came in above ours and Bloomberg consensus’ expectations on better-than-expected recovery trajectory.
  • Genting Singapore's net profit also turned from a loss of S$163.3m in 2Q to a profit of S$54.4m in 3Q20.


Strong pent-up local demand

  • With a lack of contribution from international travellers due to border controls and travel restrictions, the strong recovery in gaming and non-gaming segments could be due to pent-up demand from local traffic in 3Q20.
  • Recall that Universal Studios Singapore, S.E.A. Aquarium and RWS casino reopened from 1 July 2020 with all necessary safe management measures in place. RWS casino currently only opens to existing members and those who have paid the annual levy.

Benefit from vaccine development and potential easing of social distancing measures






Chu Peng OCBC Investment Research | https://www.iocbc.com/ 2020-11-17
SGX Stock Analyst Report BUY UPGRADE HOLD 0.96 UP 0.680



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