Analysts: Genting to see better FY22 as international borders reopen
KUCHING: Genting Bhd (Genting) is expected to see a better financial year as international borders reopen, analysts observed.
Kenanga Investment Bank Bhd’s research team (Kenanga Research) in a report, forecast a better FY22 as Singapore has reopened its international borders from April 1 which could mean Genting Singapore Ltd (Genting Singapore) is likely to experience growing volume from the second quarter of FY22 (2QFY22) onwards.
It noted that Genting’s management is cautiously optimistic of the recovery trajectory in view of the border reopening as more travelers will return to the island state which should augur well for Genting Singapore.
It had earlier disclosed investing S$400 million in 2022 for RWS2.0 and related refurbishment works for the theme park and three of its hotels to get ready for the borders reopening.
Meanwhile, it noted that Genting Singapore’s 1QFY22 core profit bounced from a weak core profit of S$12 million in 4QFY21.
In a year-on-year (y-o-y) comparison, 1QFY22 core profit dipped slightly by two per cent to S$43.5 million from S$44.5 million previously partly due to higher utilities expenses and the expiry of Covid-19 related government support measures.
All in, Kenanga Research maintained its ‘outperform’ call on the stock.
It said: “We believe the two years of lackluster earnings at Genting Singapore is likely ending with earnings recovery expected from 2QFY22 given the reopening of international borders from April 1.
“And, the same would apply to Genting Malaysia as well. This should eventually benefit parent-company Genting as well.”