Genting HK

Genting HK: 50% JV NCL Corp posted a 2Q12 net profit of US$36m (+23% yoy), within expectations, boosted by business improvement initiatives and timing (lower) maintenance and repair costs. NCL’s 1H12 revenue rose by a modest 3% yoy amid a 2% yoy increase in yield, stemming from an increase in pax ticket pricing amid flattish capacity days. Occupancy rates remained solid at 107.6%. UOBK expects GENHK to deliver a core net profit of more than US$70m in 1H12 (>+13% yoy), driven by decent growth at its 50%owned RWM (est 2Q12 EBITDA of more than US$60m vs 1Q12’s US$37m). The house maintains Buy with TP US$0.38, which values the stock at 15.2x fully diluted FY12e P/E, and 8.9x notional FY12e EV/EBITDA. Technically, UOBK notes the stock is undergoing a price consolidation and a break above US$0.34 could lead to a test of US$0.38. Key support remains at SU$0.30. Notes the MACD remains flat but its Stochastics indicator has formed a bullish crossover. Says the stock could potentially attract some interest due to the spillover interest from Genting SP during the last trading session.