Genting HK

Genting HK: CIMB maintains Add, reiterates TP US$0.48, based on 20% discount to RNAV. The house believes the negative market response to the recent resignation of Dato David Chua as president may be an overreaction as most of the required corporate restructuring has been completed. In fact, his departure seems to have foreshadowed value created by IPO of Norwegian Cruise Line and Travellers, hence the stock is undervalued at current price. GENHK balance sheet now has US$1b in cash to fund future growth. US$385m is expected to go towards financing the two new mega cruise ships that are being built and the rest should be available for M&A. CIMB remains positive on GENHK given the gaming liberalisation landscape, GENHK’s dominance as the largest cruise operator in Asia, and its ambitions for fleet expansion and renewal.