Genting Singapore - Maybank Kim Eng 2021-06-02: Ganbatte GENS

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

Genting Singapore - Ganbatte GENS-Sega Sammy JV


Upgrade Genting Singapore to BUY with higher target price.

  • We believe that the Genting Singapore-Sega Sammy JV will win the Yokohama IR RFP process. If Genting Singapore owns 50% of the JV, we estimate that a Yokohama IR will add S$1.8b to earnings and S$0.30 per share to our target price for Genting Singapore. Adding the latter to our DCF-based target price, we raise our target price for Genting Singapore to S$1.16 from S$0.86 and upgrade Genting Singapore to BUY.
  • There is a risk an anti-IR Yokohama mayor may be elected on 29 Aug 2021 but Genting Singapore (SGX:G13) is a tactical BUY as we believe no value from a Yokohama IR has been imputed into its share price currently.



Straight fight between GENS-Sega Sammy JV and Melco

  • On Monday, Yokohama announced that two groups qualified for its IR RFP process. NHK reported that the two groups are
    • a Genting Singapore-Sega Sammy (6460 JP) JV (which we did not expect) and
    • Melco Resorts & Entertainment (MLCO US).
  • On contractors,
    • Genting Singapore-Sega Sammy JV named Kajima Corporation (1812 JP) while
    • Melco named Taisei Corporation (1801 JP).
  • Recall that Kajima was the main contractor that constructed Genting Singapore’s Resorts World Sentosa.


Advantage GENS-Sega Sammy, in our view

  • In our view, Genting Singapore scores better in promoting the winner of its IR RFP process in the summer (Jun to Aug) of this year.
  • On another note, Sega Sammy stated that it would prefer a Genting Singapore-Sega Sammy JV.


Yokohama IR to add ≥ S$0.30 to our target price for Genting Singapore






Yin Shao Yang Maybank Kim Eng Research | https://www.maybank-ke.com.sg/ 2021-06-02
SGX Stock Analyst Report BUY UPGRADE HOLD 1.16 UP 0.860



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