GentingHK: Our house initiates with Buy at TP$0.54, highlighting counter is the cheapest gaming stock in the world with half of valuation from gaming ops. Co’s share of gaming license held by 50% owned Travellers could be worth approx US$0.56 when fully utilized and expected IPO of Norwegian Cruise Lines to take place this year which would unlock value for co as well…
The spin-off would offer opportunity to dispose cruise business and allow co to concentrate on gaming business. After 4 yrs of losses, co is expected to turn a profit for FY10 and valuation is based on SOTP with implied FY11F of EV/EBITDA at 13.0x.
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