Thursday, August 30, 2012

There's still growth in Genting Malaysia

At a time when we thought, Resorts World Malaysia is to have tough competition from Resorts World Singapore and Sands Singapore, as well as other more popular gaming destinations as in Macau, Genting Malaysia actually sprung a surprise in terms of what they can achieve. When Genting Malaysia was acquiring the group's gaming businesses in UK from Genting Singapore, the group got some flak as in it was presumed that the UK business is not a profitable business to be acquired. This time around based on its performance for the first half a year, there are some surprises considering the economic condition Europe is suffering from. As you can see, RW Malaysia still has growth both in revenue and EBITDA.

Quarter vs Quarter comparison is great even for revenue and EBITDA
The growth in UK shows that the group could possibly be very serious in building their businesses beyond Malaysia and Singapore. As I said in my previous article, we do not know how well these businesses in UK and US will turn out despite the seemingly bad press they are getting. One thing I know from my observation of its competitors, Genting is the strongest among the big players - and that includes Sands ("LVS").

We do not know that the group is taking this opportunity to expand fast and usually when a company is trying to do things fast there could be mistakes - as long as they are learning and manage those mistakes, that's allright. Remember, Malaysia and Singapore operations are huge cash cows.

9 comments:

Benson said...

Hi felicity, will u consider to buy this stock or wait for some discount 1st? Thx ya.

felicity said...

I do not know to be frank. Performance for Genting Malaysia is important for Genting Bhd though and I am more keen on Genting Bhd

keano said...

Hi felicity,

have you looked at Gamuda before? The target price of most analyst are RM4 to RM6 but the share price seems to lag at RM3.50. Would like to know if you know the reason for this non-performance of Gamuda. Thx

felicity said...

One of the reason for Gamuda is that it is a political stock. I would think for any company which is largely dependent on government's projects, they are being viewed as being needed to be careful on its future especially for companies such as Gamuda.

keano said...

thx for the info! Too bad, I have bought into this stock. I guess I just have to wait

khengsiong said...

GENM's quarterly results surprised me, too.
Still, I think Eurozone crisis will have an adverse effect on UK's operation.

siewpao said...

Hi Feli,

Tks for the good feedback on GENM.
What are the chances of some goodies for the faithful shareholders? Nothing given since the splitting of shares, I think.
The Dividend is only creeping up, much lower than most of the big companies in Malaysia.

peter moo

siewpao said...

Hi Feli,

Any goodies can be expected from GENM for the faithfuls?

felicity said...

On special dividends, I do not think so as it seems that they are going for expansion rather than handing out the cash to shareholders.