The Borneo Post (Sabah)
Genting Malaysia to record exponential recovery in FY22
KUALA LUMPUR: Genting Malaysia Bhd’s (Genting Malaysia) long-term prospects have been viewed positively by analysts as they believe that Genting Malaysia could see an exponential year-on-year (y-oy) profit growth in the financial year 2022 (FY22).
“We expect a significant y-o-y recovery for Genting Malaysia in FY22 due to the timeline of vaccine rollouts and we are confident that Malaysia will achieve some form of normalcy in FY22.
“We believe that the public’s willingness to travel would be positively correlated with the vaccination rates in the country,” said the research team at Hong Leong Investment Bank Bhd (HLIB Research) in a report.
For this year, it believed that FY21 could continue to be very challenging for Genting Malaysia as inter-state travel is still banned.
“We now expect the interstate travel ban to be in place for one more month and this would imply a footfall of less than 15 per cent for a total of four months for RWG since the inception of MCO2.0,” it said.
Meanwhile, HLIB Research noted that the main beneficiary from its SkyWorld theme park, which is expected to be open by 1H21, would be its casinos and occupancy rates for its hotels as families would frequent RWG more since it would be a place of attraction for both adults and kids.
All in, HLIB Research downgraded its FY21 earnings forecast from RM669 million to a loss of RM74.2 million due to the longer than expected interstate travel ban.
Nevertheless, it upgraded its call on the stock to ‘buy’. It said: “We believe that investors would start to look ahead with plenty of positives in the pipeline like the lifting of inter-state travel ban, higher vaccination rate and lower fears of Covid19 infections, and opening of Skyworlds theme park.”