Genting HK

Genting HK: Deutsche initiates at Buy with TP US$0.57, pegged at 15% discount to its sum-of-parts valuation. Likes GENHK for its unique proposition – offering both sea and land gaming at 14-31% FY14 EV/EBITDA or 34-43% P/E discount to its cruise and Asia casino peers. Notes GENHK has been unlocking value from its assets, beginning this year with the successful listing of Norwegian Cruise Line (NCL) whereby its equity value has tripled since 2007. The imminent IPO of 50% owned Travellers should unlock further value. At the current share price, and if the Asia cruise business were valued at 8x P/E, this means the market is ascribing zero value to GENHK’s stake in Travellers, which could be potentially worth up to US$0.22 per GENHK at the IPO price of P$11.28/sh.