Tuesday, January 21, 2014
Genting HK: Deutsche maintains Buy, still likes GENHK as a deep value play, on the back of its 37% discount to SOTP valuation, and nearly US$1b gross cash after paring down its stake in NCL. Moreover, the Lim family has raised its stake to 58.1% or 75.9% including that held by Genting Msia. The house however trim its TP to US$0.545 (from US$0.57), to take into account a downward earnings revision. According to mgt, while 2013 gaming operations in Asian cruise remained robust, profitability was affected by lower VIP holds and a tough comparison given above-theoretical hold in FY12. couple with lower associate contributions following the NCL divestment, Deutsche has lowered its FY13-15e core net profit by 54%, 22% and 18% respectively. Meanwhile RWM, which also suffered low hold in 2013, may see a disappointing FY13 given the typhoon effect in 4Q13.