Date of Report: 3 October 2024
Broker: UOB Kay Hian
Positive Outlook for 2H24
Genting Singapore (GENS) has a bright outlook for the second half of 2024, supported by multiple catalysts. The company is expected to benefit from an accelerated recovery in foreign visitor arrivals and increased flight frequencies.
Major Entertainment Events
The upcoming major entertainment events, including the Formula 1 Grand Prix, are anticipated to drive higher footfall to Resorts World Sentosa (RWS). Additionally, the sustained trend of increased average spending at the integrated resort, particularly in non-gaming segments, is expected to contribute positively to the company’s performance.
New Hotel Launch and Increased Capacity
Genting Singapore’s recent launch of Hotel Ora is projected to enhance key inventories by approximately 30% year-on-year. This addition is expected to further attract visitors and increase overall revenue streams for the company.
Strong Digital Marketing Efforts
The company has intensified its digital marketing initiatives, which are likely to lead to higher visitor footfall and spending at RWS. These efforts are part of a broader strategy to capitalize on the recovering tourism market.
Financial Position and Target Price
UOB Kay Hian maintains a “BUY” rating for Genting Singapore, with a target price of S$1.25. This valuation reflects the company’s robust financial position and the potential for earnings growth as the tourism sector continues to recover.
Key Catalysts for Growth
Key events that could enhance Genting Singapore’s share price include:
- A continued recovery in patronage from Chinese tourists as flight frequencies increase.
- Effective management of capital resources following the withdrawal from Japan’s Integrated Resort pursuit.
- A commendable yield forecast of 4.5% for 2024, attracting investor interest.
