{"id":17482,"date":"2024-07-26T07:00:30","date_gmt":"2024-07-25T23:00:30","guid":{"rendered":"https:\/\/www.smallcapasia.com\/?p=17482"},"modified":"2026-06-08T19:30:39","modified_gmt":"2026-06-08T11:30:39","slug":"genting-singapore-a-winning-hand-in-1q24","status":"publish","type":"post","link":"https:\/\/www.smallcapasia.com\/zh-hant\/genting-singapore-a-winning-hand-in-1q24\/","title":{"rendered":"Genting Singapore &#8211; A winning hand in 1Q24"},"content":{"rendered":"<p><em>Excerpts from CGS International report<\/em><\/p>\n<h2>Genting Singapore (SGX: G13)<\/h2>\n<ul>\n<li>Genting Singapore 1Q24 adj. EBITDA reached S$369.5m, exceeding expectations at 32.2% of both our and Bloomberg consensus FY24F estimates.<\/li>\n<li>A strong adj. EBITDA margin of 47.1% in 1Q24 (+7.5% pts yoy\/+12.0% pts qoq) suggests a confluence of better win rates and collections, in our view.<\/li>\n<\/ul>\n<p>Reiterate Add and TP of S$1.30. We believe its current valuation at more than 1 s.d. below 5-year mean of 9.2x 12M fwd EV\/EBITDA is attractive.<\/p>\n<h2>Strong seasonality and potential one-offs in 1Q24<\/h2>\n<p>Genting Singapore\u2019s 1Q24 adjusted EBITDA of S$369.5m (+92.7% yoy) was driven by strong revenue growth of both its gaming (+69.5% yoy) and non-gaming segments (+44.2% yoy) due to increased visitorship and tourism spending.<\/p>\n<p>However, we believe the strong adj. EBITDA margin expansion of 12.0% pts qoq despite the relatively flat non-gaming revenue on a quarterly basis (+1.0% qoq) against the increase in its gaming revenue (+30.6% qoq) suggests Genting Singapore benefitted from either a stronger win-rate, better bad debt collections, or both, in 1Q24 against 4Q23.<\/p>\n<h2>Travel recovery to likely to play out by 2Q24F<\/h2>\n<p>With YTD IVAs recovering to 92.9% of 2019 levels, we think that further recovery in IVAs will be limited in light of latest data from Singapore Tourism Board that indicated Apr 24 IVAs only reached 84.9% of Apr 19 levels.<\/p>\n<p>Nevertheless, IVAs is likely to experience robust yoy growth of c.20% in 2Q24F; a Straits Times article published on 6 May 24 reported that<br \/>\ntour operators saw an increase in Chinese tourist arrivals for the Labour Day \u201cGolden Week\u201d from 1 May to 5 May, which we believe will support IVA numbers.<\/p>\n<p>We think that this will help to partially offset GENS\u2019s weak non-gaming segment, which has been hampered by ongoing renovation works in Hard Rock Hotel, in turn reducing its key inventory by c.25%, as well as in the Forum, likely dampening leasing activities for F&amp;B outlets.<\/p>\n<h2>Valuation\/Recommendation<\/h2>\n<p>Maintain Add as attractive valuation as profitability normalises. Our TP, pegged to its 5-year historical mean EV\/EBITDA of 9.2x, stays at S$1.30 despite increases to our FY24-26F adj.<\/p>\n<p>EBITDA by 2.2-5.7% due to a slight decline in the valuation multiple to 9.2x from 9.4x previously as a result of the recent de-rating of the stock.<\/p>\n<p>Genting Singapore is currently trading at an attractive 5.6x forward EV\/EBITDA, more than 1 s.d. below its 5-year historical mean. We also reduce our lower non-gaming revenue estimate for FY24F given renovation in Hard Rock Hotel and the Forum, which management expects to complete by end-FY24F.<\/p>\n<p>We think Genting Singapore\u2019s non-gaming revenue from FY25F will be supported by the launch of new attractions, such as Minion Land, the Singapore Oceanarium and the Asia premiere of Harry Potter.<\/p>\n<p>Visions of Magic as well as amenities like the revamped Hard Rock Hotel and the Central Lifestyle Connector (i.e. revamped Forum). Re-rating catalysts: stronger non-gaming revenue growth and sustained higher adj.\u00a0EBITDA margins from cost control.<\/p>\n<p>Downside risks: higher bad debt recognition and delayed completion of construction works.<\/p>\n<p><a href=\"https:\/\/www.smallcapasia.com\/wp-content\/uploads\/2024\/07\/Genting-Singapore-share-price-chart.jpg\"><img fetchpriority=\"high\" decoding=\"async\" class=\"size-full wp-image-17485\" src=\"https:\/\/www.smallcapasia.com\/wp-content\/uploads\/2024\/07\/Genting-Singapore-share-price-chart.jpg\" alt=\"Genting Singapore share price chart\" width=\"1527\" height=\"500\" \/><\/a><\/p>\n<p><span style=\"font-size: 14px;\">Genting Singapore share price chart<\/span><\/p>\n<p>You can find the full report <em><a href=\"https:\/\/www.smallcapasia.com\/wp-content\/uploads\/2024\/07\/Genting.pdf\">here<\/a> <\/em>and the company website<em> <a href=\"https:\/\/gentingsingapore.com\/#!\/en\/investors\/news-and-announcements\" target=\"_blank\" rel=\"noopener noreferrer nofollow\">here<\/a><\/em>.<\/p>\n<p>[thrive_leads id=&#8217;15712&#8242;]<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Excerpts from CGS International report Genting Singapore (SGX: G13) Genting Singapore 1Q24 adj. EBITDA reached S$369.5m, exceeding expectations at 32.2% of both our and Bloomberg consensus FY24F estimates. A strong adj. EBITDA margin of 47.1% in 1Q24 (+7.5% pts yoy\/+12.0% pts qoq) suggests a confluence of better win rates and collections, in our view. Reiterate [&hellip;]<\/p>\n","protected":false},"author":36,"featured_media":17487,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[3053,3051],"tags":[655,881,1331,1869,1943,1945,2394,2847],"class_list":["post-17482","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-reits-dividend-stock-coverage-singapore","category-singapore","tag-genting-singapore","tag-singapore-stocks","tag-singapore-stocks-to-buy","tag-gaming-sector","tag-singapore-stocks-ideas","tag-casino-stocks","tag-gaming-stocks","tag-hospitality-stocks"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.smallcapasia.com\/zh-hant\/wp-json\/wp\/v2\/posts\/17482","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.smallcapasia.com\/zh-hant\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.smallcapasia.com\/zh-hant\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.smallcapasia.com\/zh-hant\/wp-json\/wp\/v2\/users\/36"}],"replies":[{"embeddable":true,"href":"https:\/\/www.smallcapasia.com\/zh-hant\/wp-json\/wp\/v2\/comments?post=17482"}],"version-history":[{"count":4,"href":"https:\/\/www.smallcapasia.com\/zh-hant\/wp-json\/wp\/v2\/posts\/17482\/revisions"}],"predecessor-version":[{"id":17489,"href":"https:\/\/www.smallcapasia.com\/zh-hant\/wp-json\/wp\/v2\/posts\/17482\/revisions\/17489"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.smallcapasia.com\/zh-hant\/wp-json\/wp\/v2\/media\/17487"}],"wp:attachment":[{"href":"https:\/\/www.smallcapasia.com\/zh-hant\/wp-json\/wp\/v2\/media?parent=17482"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.smallcapasia.com\/zh-hant\/wp-json\/wp\/v2\/categories?post=17482"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.smallcapasia.com\/zh-hant\/wp-json\/wp\/v2\/tags?post=17482"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}