Genting SP: Spore's casino operators are likely to post solid 3Q results on better win factors and strong visitor arrivals due to Sept's F1 events, UOBK says, citing its own site visits, which suggest slight on-quarter improvements in VIP and mass market revenues.
The house expects GENS to deliver stronger EBITDA on-quarter, "premised on a substantially improved win percentage, although we reckon VIP rollings have only improved slightly and mass market growth continues to be sluggish."
Keeps Buy call but cuts TP to $2.04 from $2.21, based on 12X EV/EBITDA vs 13X previously to factor in higher risk aversion. Says GENS also benefited from improved arrivals during Genting Group Chairman Lim Kok Thay's birthday celebrations at its resort, and adds rival MBS is likely to post stronger results in the traditionally weak 3Q, assuming its win percentage stays at around the above-theoretical level of 3% posted in 1Q.
GENS is +2.3% at $1.545
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