KUALA LUMPUR: With vaccines against Covid-19 in their final stages before commercialising, better prospect for cross-border reopening should help boost investor sentiment on Genting Bhd, Kenanga Research said.
The firm said the surprising turnaround of Genting Singapore Ltd should provide a further boost to the group.
"We only expect a recovery to pre-pandemic level in 2022. On the other hand, Genting Singapore still indicated that it is keenly exploring the Yokohama integrated resort opportunity in Japan," Kenanga Research said in a report today.
In a quarterly business overview released last Saturday, Genting Singapore reported a turnaround with core profit of S$73.2 million in the third quarter (Q3) of 2020 from a core loss of S$116.5 million in the preceding quarter.
Its nine-month core profit was at S$9.9 million against market consensus of a net loss of S$158.7 million.
"The stronger-than-expected set of results was attributed to higher-than-expected revenue as it reopened for business from July 2020," Kenanga Research said.
The firm said at the adjusted earnings before interest, taxes, depreciation and amortisation (Ebitda) level, Genting Singapore's nine-month earnings of S$215.7 million had beaten house and street's 2020 full-year estimate of S$147.3 million and S$151.5 million respectively.
Kenanga Research said in last quarter's conference call in September, Genting's management had indicated that it was operating at 50 per cent of gaming capacity since the re-opening on July 1 this year.
This was somewhat reflected in Genting Singapore's Q3 2020 revenue of S$301 million which was half of the usual quarterly revenue pre-pandemic period.
Kenanga Research has retained its "outperform" call on Genting, with an unchanged price target of RM5.10.