liveindices.com

[rickyllc]

What will happen after today, when the rights can be traded as an ordinary share?

What I'll do is to sell what I am have now and hold the rights for the opening of Genting Singapore

[inphyy]

Encouraging tourist arrival numbers

Strong tourist arrivals bode well. Genting Singapore (GS)
- which recently posted a much stronger-than-expected set of
1Q10 results - should continue to do well, buoyed by the strong
influx of tourists into Singapore. According to the Singapore
Tourism Board (STB), tourist arrivals jumped 20.4% YoY
(+1.1% QoQ) to 938k foreigners - it is also the fifth straight
month in which record monthly visitor arrivals were logged.
The STB is targeting to pull in 11.5m to 12.5m visitors this
year. Equally important is the strong jump in tourists from
neighbouring Asian countries like Thailand (+57.5%), Malaysia
(+50.8%) and India (+30.8%) while Indonesians remain
Singapore's top market with 163k arrivals, up 8%; we believe
that these countries are important catchment areas for GS,
especially those within a five-hour plane ride from Singapore.

S$70m of entry levies collected. On the casino front, the
Singapore government recently announced that the casino
entry levy - payable by Singapore citizens and permanent
residents - collected by the two integrated resorts (IRs)
amounted to S$70m as of 10 May. But since Marina Bay
Sands (MBS) only opened its doors to the public in late Apr,
the bulk of the collection is likely to have come from Resorts
World Sentosa (RWS) which started its casino operations on
14 Feb. And as the annual entry levy of S$2000 is casino
specific, we suspect that RWS may have a slight first-mover
advantage over MBS. Meanwhile, our checks suggest that
the gaming activities over at RWS have remained fairly stable
and were not adversely affected by MBS' opening as some
had feared.

Universal Studios Singapore ramping up. For the rest of
RWS, management recently revealed that its hotels continue
to see high occupancy rates (>60%) since opening with an
average room rate of S$250/night. This is also in line with our
observations during our recent visits to the resort. As for
Universal Studios Singapore (USS), GS recently ramped up
its daily intake from the initial 3k visitors to 5k as the park
continues to get run-in; we should see a further increase due
to the upcoming Jun school holidays. We also understand
that work has commenced on Phase 2 (West Zone) of the
integrated resort and new attractions (including a marine park)
should be ready by end 2011.

Maintain BUY. Based on the encouraging tourism numbers
and the recent 1Q10 results, we remain upbeat about RWS'
prospects this year, and maintain our BUY rating and S$1.29
fair value.

OCBC SECURITIES

[inphyy]

Genting Singapore to divest UK operations

By Jonathan Peeris | Posted: 01 July 2010 2010 hrs

SINGAPORE : Mainboard-listed Genting Singapore said it will divest its casino businesses in the United Kingdom to Genting Malaysia for 340 million pounds (S$688.8 million).

Genting said the divestment of the UK operations will allow it to focus on strengthening the large scale integrated resort experience it gained in developing Resorts World Sentosa (RWS).

The sale of the operations will also add resources to enable RWS to conduct customer acquisition, marketing and brand development.

Genting added that the net proceeds of the proposed divestment may also be deployed for strategic growth opportunities in the leisure, hospitality and gaming sectors, when such opportunities arise.

The proposed divestment requires the approval of non-interested shareholders at an extraordinary general meeting that will be convened. - CNA /ls

[inphyy]

Genting S'pore shares offer thrills and spills

Stock rises to 6-month high before closing just 2cents up for the week

By ARTHUR SIM
Published July 3, 2010

NEWS that Genting Singapore is selling its UK operations to Genting Malaysia sent their shares in opposite directions yesterday.

On the Singapore Exchange, Genting (S) once again provided all the action on what was otherwise a quiet Friday.

Early morning trades saw the share price of the Singapore integrated casino resort operator climb to a near six-month high of $1.21 from Thursday's $1.18 closing.

About 190 million shares were traded. But as the counter has been firming of late, profit-taking seeped in, with the price ending two cents down at $1.16, but still up two cents for the week.

The early morning surge can be attributed to the generally positive market response to Genting (S)'s divestment of its UK casino operations for about $688.8 million.

In a report, Citigroup analysts said that considering that the UK gaming operating business remains very tough, 'we view this exit as an escape for Genting (S) and we view it as fortunate in that there was a buyer in the market'.

'Investors should view this move positively, as it means Genting UK will no longer drag on the performance of Resorts World Singapore and it cleans up the company's organisational structure,' it added.

Citigroup said that it believes the sale price for Genting (S)'s 44 UK casinos was also reasonable but added that it estimates the higher-than-expected sale price will add less than three cents to the stock's market value.

Morgan Stanley analysts were also positive on the divestment but added that the company was cutting its losses at a dilutive multiple. Morgan Stanley noted that Genting (S) bought the UK business in 2006 at a price of $1.861 billion - thus the value lost was $1.17 billion. It also added that while Genting (S) could book a paper gain of $103 million (based on sale price to book value), it will have to also record a loss of $338 million owing to currency translation.

Across the Causeway, the story was different for Genting Malaysia or Genting (M), Malaysia's sole casino operator. A Bloomberg report yesterday said that the stock tumbled the most in five weeks on concern that it was paying too much for the UK gaming businesses of its parent company's Singapore unit.

The stock fell 4.4 per cent to close at RM2.62 (S$1.13), its biggest drop since May 26. It slumped as much as 10 per cent earlier, the most in almost nine years. It was the worst performer on the benchmark FTSE Bursa Malaysia KLCI Index yesterday, said Bloomberg.

The proposed acquisition reportedly prompted a wave of downgrades of the Malaysian stock from brokerages, with one calling the transaction 'value destructive'.

Interestingly, analysts in Singapore still seem divided about the prospects of Genting (S) and, more broadly, the potential of the gaming industry here.

Morgan Stanley has an 'equal weight' rating on Genting (S) with a target price of 94 cents while Citigroup has a 'sell' rating with a target price of 65 cents.

Macquarie Equities Research raised its target price to $1.30 a share from $1.19 previously on news of the divestment. 'Genting Singapore benefits three ways: via interest expense savings, both from a lower gross debt and potentially a lower interest rate charged from keeping within various loan parameters, and being able to focus on the ramp-up of Sentosa,' it said.

Morgan Stanley finds Genting (S) 'the most expensive stock in our gaming coverage universe (16 times 2011 estimate EV/Ebitda)'. 'Upside could be capped despite strong visitation to and revenue generated by Singapore casinos,' it added.

On a positive note, Citigroup said that following its own checks, 'we believe that Resorts World Sentosa (RWS) has a higher market share versus Marina Bay Sands (MBS) in terms of gaming revenue'.

[inphyy]

Selling off UK operations

Selling off UK operations. Genting Singapore (GS) has
entered into a conditional sale and purchase agreement with
Genting Worldwide UK - an indirect wholly-owned subsidiary
of Genting Malaysia Berhad (GENM) - to divest its entire UK
casino operations for £340m (or S$688.8m). The purchase
price is however subject to adjustments if GENM subsequently
discovers any liability - either accrued or incurred by the sale
group - of more than £5m not previously provided for in the
audited FY09 accounts or unaudited 1Q10 management
accounts. The deal is conditional upon getting approval of GS
shareholders, approval of GENM shareholders, and approval
from Bank Negara Malaysia and British Gambling Commission
among others.

Wants to stay focused on RWS. According to GS, the main
reason behind the divestment is to allow management to better
spend its energy and focus on Resorts World Sentosa (RWS)
Integrated Resort, which is unprecedented in terms of scale
of development and its diverse world class tourism destination
product offerings, to maximize revenue potential. In addition,
GS believes that there are also "narrow" synergies between
RWS and its UK casino operations. Last but not least, GS
adds that the financial resources arising from the proposed
divestment will provide it with the financial flexibility to maintain
its strength and strategically engage new opportunities or enter
new markets where appropriate.

Minimal impact on GS performance. If the proposed
divestment is completed, GS will receive net proceeds of
~S$688.8m and will book an excess over book value of around
S$103.6m. It had earlier paid £699.4m (~S$1.4b) for it in 2006.
However, it will also recognize a non-cash exchange translation
loss of ~S$338.8m on its P/L; in total, we are likely to see GS
book an accounting non-cash loss of S$235.2m. But as we
view the transaction as exceptional, we are not overly
concerned. Nevertheless, we expect the sale to reduce our
FY10 sales estimate by 24% but increase our net profit
estimate by 13% as margins would improve ex-UK operations.

Outlook for RWS remains upbeat. As we also believe that
GS is likely to spend less in capex without its UK operations,
our DCF-based fair value rises from S$1.29 to S$1.34. Overall,
we agree with management's intention to focus its energy on
RWS and also opportunities in the region, as gaming here is
still likely to experience good growth prospects. Maintain BUY.

OCBC SECURITIES

[inphyy]

Need to pull back after 2-month 43% surge from 85c to $1.21
but uptrend remains intact even with 7% to 10% fall to $1.12-
$1.08

The stock is now at the highest of its mid-June breakout from $1.04 to
$1.14 as it tries to find support around the $1.15-17 highs that
prevailed after last year’s run-up before the early 2010 correction.

Having returned to the low end of the highs of $1.20-1.32 since Sept
to Jan, there is concern that there could be a repeat of the 13%
correction from $1.20 to $1.04-07 that took towards end-2009.
However since the mid-June mini-breakout from $1.06 on heavy
volumes it has quickly moved back to $1.12 after brief dips to $1.10-
11.

It also marked the first time it has clearly broken above the 200 DMA
(now at $1.05) since the new year plunge.

Interestingly there is a good chance of a bullish cut with the strongly
rising 50 DMA ($1.03), ahead of the expected Aug 6 earnings
release.

There was a golden cross between 50 and 200 DMA in mid-Jun and
the prospect of another cross in days ahead would reignite memories
of similar series in April last year which ushered in the 2009 rally.

There is no major or double top formation at last week’s $1.21 high
unlike the Jan situation when quick plunges $1.02 and then to as low
as 83.5c within 6 weeks confirmed such a situation.

It is also unlikely there will be a repeat of the lengthy 3-month
consolidation around $1.05-20 before the year-end push, given the
stronger volume since May compared to that period.

Although upper Bollinger band ($1.22) acts as limit, it has not fallen
below mid-band ($1.0 since end-May. While daily MACD has
turned down indicating a temporary breather, weekly and monthly are
rising strongly indicating bullish medium to longer term trend.

With minimum 10c-14c monthly movements over the past year, July’s
7c trading band so far between $1.21 to $1.14 should be closer to
last 2 months’ wide ranges of 18-21c especially ahead of results.
A test of last week’s $1.21 high could be seen again soon as a mov
e
into $1.22-25 will be required before the gap to $1.30-32 is filled.
Having gone all the way up building series of higher weekly lows from
$1.04 to $1.12 there is likely to be keen trading interest at $1.12-14.

AMFRASER SECURITIES

[inphyy]

Another week or so of quiet $1.16-$1.20 consolidation should
usher in rally to $1.22-26

Stock expected to maintain its series of higher or unchanged lows
since 85c about 3 months ago with latest lows at $1.12, $1.13 and
$1.16 in last 3 weeks. This means even if today’s low of $1.17 does
not hold this week, $1.16 is likely to anchor it.

Underpinned by the rising 15 –day EMA ($1.16) since end-May, the
narrowing gap with the 65 EMA ($1.07) looks like a potential golden
cut in the making in coming few weeks.

In addition, simple 50 and 100 DMAs continue their strong uptrend
which should nudge the flattening 200 DMA, which had made a
neutral cross with 50 DMA last week, on an upward course soon.
In mid-June there was a bullish cut between 50 and 100 leading the
counter to climb from its then $1-$1.07 consolidation area to a
breakout to $1.10-12. For the past month the low has been held at
$1.12, adding to the generally bullish picture.

Bollinger bands too are showing signs of a move away from current
$1.16-20 range which should take stock to its current upper limit of
$1.23, anchored at mid-band of $1.14.

With monthly movements of a minimum 10-14 cents since March last
year, GS has moved barely 8 cents this month between $1.13 to
$1.21, which brightens prospects of a test of $1.22-23 and possibly
$1.25-26. These levels were the lows and closings at year-end and
January when the stock tested its $1.30-32 record highs.

It has been almost 6 months since these peaks were seen and by
time results are out estimated on Aug 6, we can expect it to move
towards the highs as by then there could be another golden cross
this time between 100 ($99c) and 200 DMA ($1.06) or imminent cut.

AMFRASER SECURITIES

[inphyy]

Genting HK: a gem that's undervalued

By VEN SREENIVASAN
Published August 4, 2010

THE biggest game in town - and the region - in recent months has been the gaming sector. The successful openings of the Singapore integrated resorts (IRs) and the continuing buoyancy of the Macau gaming scene seem to have captured the market's imagination.

Marina Bay Sands (MBS) recently reported an impressive US$94.5 million in adjusted Ebitda (earnings before interest, tax, depreciation and amortisation) during its first 65 days of operations. Meanwhile, Goldman Sachs last week noted that Genting Singapore's Resorts World Sentosa (RWS) is proving to be a strong competitor, retaining 60 per cent of the market share post-Sands opening, and chalking up quarterly gaming revenue of some US$3 billion. Further north, the Macau casinos have powered past the most optimistic expectations, posting revenue growth in excess of 60 per cent this year.

Little wonder that gaming stocks have been soaring despite the market volatility. Genting Singapore is already up 50 per cent in less than two months, while the Macau gaming counters have gained some 50-80 per cent since February.

And valuations reflect the bullishness. The Macau casinos are trading at core 2010 price-earnings multiples of over 24 times and a price-book value of over four times, while Genting Singapore is currently trading at some 28 times FY2010 earnings and 3.5 times its book value.

But there is one gaming company which has been somewhat overlooked: Genting Hong Kong (Genting HK). Formerly known as Star Cruises, Genting HK is now a three-pronged gaming entity comprising Star Cruises in Asia, Norwegian Cruise Line (NCL) in the US, and Resorts World Manila (RWM) in the Philippines.

At its closing of 26 US cents yesterday, the stock of Genting HK is trading at a significant discount to those of its peers and just close to its own net book value. It recently started stirring after a UOB-Kay Hian report two weeks ago, which said the company was on the verge of a take-off.

Indeed, Star Cruises started operating the Hong Kong-Taipei route in May 2009 and is seeing a sharp earnings recovery, thanks to savvy restructuring and an occupancy of 90 per cent. The fleet, valued at almost US$5 billion, gets two-thirds of its gaming revenue from the non-Singapore cruise business and its operating profit is expected to reach US$50 million this year.

Meanwhile, 50 per cent-owned NCL is back in the black, thanks to aggressive cost management and a strong wave of bookings. UOB-Kay Hian noted that its yields are now comparable to the world's largest cruise companies. The latest vessel - the US$1.3 billion Norwegian Epic, which was launched in July - is expected to contribute to earnings this year, with a six-year payback.

But the jewel in Genting HK's crown has to be its 50 per cent-owned Resorts World Manila (RWM). Built at a cost of US$400 million - less than a tenth of what it cost to build each of the two IRs here - this is a pure casino play. The property, which is three times the size of its Sentosa sister, has been raking in the big bucks, thanks to its ability to leverage on the Genting group's network of high rollers and significantly lower gaming taxes (at 25 per cent).

With a current daily gross win at its casino of US$1 million a day, Genting HK is expected by analysts to see a payback period of under five years - a truly remarkable return on investment. With its 30,000 square metres shopping mall due to open later this year, RWM is also seen by industry observers as being able to contribute almost US$40 million to Genting HK's bottom line this year, and some US$70 million net profit in 2011. This is even before it builds its planned mega casino-cum-theme park on its 37 hectare site. If it delivers on its potential, RWM could become the most profitable casino operator in the Asia Pacific in short order.

There is speculation that Malaysian gaming tycoon Lim Kok Tay, who controls 72 per cent of Genting Hong Kong, could - at some point - decide that Genting HK's three profitable and independent businesses (Star Cruises, NCL and RWM) should be demerged and listed separately.

Such a move would significantly boost shareholders' value.

Goldman Sachs recently upgraded the Genting group as an undervalued proxy to global gaming on the back of its much stronger franchise following the successful launch of RWS, which it estimates will earn S$855 million in 2011.

Genting HK, whose RWM has a domestic market base of 100 million people (versus 29 million for Genting Malaysia and five million for Genting Singapore), should in time replicate RWS's potential and further add to the group's value proposition.

Based on the numbers, Genting HK appears to be an under-recognised and undervalued gem that investors should take note of - especially those who have missed the boat on Genting Singapore.