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Genting Singapore
17-06-2018, 09:21 AM.
Post: #141
RE: Genting Singapore
At around S$1.25, I think there is an opportunity.

Sharing my analysis.


Attached Files
.pdf   Genting Singapore_Investment Analysis_17June2018.pdf (Size: 2.02 MB / Downloads: 42)

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07-04-2019, 09:26 PM.
Post: #142
RE: Genting Singapore
I think that Genting Singapore has got a really bad deal with the expansion of RWS. 

Heavy investment of S$4.5bn and largely on non-gaming facilities. 

Would require very bullish projections of gaming and non-gaming revenue growth for the investment to pay off. Yet with casinos sprouting across Asia.

Would management have went for an investment of this magnitude if left to its own decision? 

Hope to hear some thoughts.

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08-04-2019, 07:59 AM.
Post: #143
RE: Genting Singapore
(07-04-2019, 09:26 PM)Choon Wrote: I think that Genting Singapore has got a really bad deal with the expansion of RWS. 

Heavy investment of S$4.5bn and largely on non-gaming facilities. 

Would require very bullish projections of gaming and non-gaming revenue growth for the investment to pay off. Yet with casinos sprouting across Asia.

Would management have went for an investment of this magnitude if left to its own decision? 

Hope to hear some thoughts.
Your suspicion is probably correct. Bobian for Genting Singapore to contribute to Singapore's nation building. Take it (by contributing $4.5b) or leave it (exit SG casino).

The amount ($4.5b) seems to be around half the profits that Genting Singapore is making.

Maybe we'll see a thank you note from Singapore to Malaysia for nation building (expansion of attractions by Genting, free takeover of Tuaspring's water asset that is debt-financed by Maybank)

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08-04-2019, 09:51 AM. (This post was last modified: 08-04-2019, 11:11 AM by AQ..)
Post: #144
RE: Genting Singapore
I don't follow this in great detail, but cursory thoughts:

1. The authorities have negotiated a decent deal for itself. The only thing on the table is to decide an end to the exclusivity but this bargaining chip is pretty weak i think. Is there really enough political support for a third casino in sg? Personally i think no - so even if the exclusivity clause is to lapse, there will prob not be a third player granted for quite some time.

The deal essentially is for an expansion of gaming machines -  1000 for MBS and 800 for RWS respectively. In return they need to sink in 9bio for MICE etc (which are relatively low yielding) which will bring in decent GDP growth after multipliers into construction+tourism etc, on top of rises in taxes on revenues i.e. the G has essentially reaped very good ROI in exchange for promising further exclusivity (which is prob going to happen anyway) + plots of land.

2. I think Sands have gotten a very good deal thus far. MBS was built @ cost of 5.6bio USD (inc land costs) and reported 49% of Shoppes alone was up for sale for 3-3.5bio USD. So the entire project is throwing up good cashflow and they wait for super-prime land capital appreciation. Adelson should be grinning.


 https://www.marinabaysands.com/content/d...tsheet.pdf

https://www.straitstimes.com/business/co...oppes-mall

3. In comparison think Genting has the weaker deal - less gaming machines than MBS+still no junkets allowed but need to spend a bunch of capex on less prime land.

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05-06-2019, 01:17 AM.
Post: #145
RE: Genting Singapore
Genting generates strong cashflow of up to $1b per yr, with net cash position at abt S$3.30 billion. It's pipeline includes the S'pore IR expansion(ard S$4.5b) & developing a Jp casino.
 
Given the "expected" high capex in Jp mentioned in the article below, it will be interesting to see Genting's capital funding plans.

---------------------------------------------------------------------------------------------------

Pricey Japan is best game in town for US casinos
Published : Tue, Jun 04, 2019 - 10:17 AM

[HONG KONG] Pricey Japan is the best game in town for US casinos. The likes of Las Vegas Sands and MGM Resorts had already vowed to spend US$10 billion each on a complex there.... Last week the city of Yokohama announced rivals vying for concession rights there are offering to splurge close to US$12 billion....

Yet Japan is not cheap. Investors must factor in high labour and construction costs, and then there's the question of how enthusiastic the locals will be. A 2017 Las Vegas survey found Japanese tourists were the stingiest, spending less than half Chinese peers. ....

Japan legalised casinos in 2016 and is developing specific regulations for casino resorts at three locations across the country. Las Vegas Sands, Wynn Resorts, MGM Resorts, Melco Resorts and Entertainment, Galaxy Entertainment and Genting Singapore have all expressed interest in developing a complex, according to filings and media reports.

REUTERS

More details : https://www.businesstimes.com.sg/consume...us-casinos
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11-06-2019, 07:28 PM.
Post: #146
RE: Genting Singapore
I think Genting has got a seriously bad deal. Another $5b capex for 10 years of license is equal to losing $500m per year
these new capex won't generate much ROI.

I feel Genting should sacrifice the exclusivity and let in new competitors. It won't be worse off, unless there are more than 2 new competitors. The new ROI effectively halved Genting's net profit for the next 10 years. This makes the current dividend of 3.5 cents per year a little risky. Don't think Genting can afford to pay any more than that.

But it's good for the economy. With very little FDI nowadays, both casino's $10b injection is a gift from heaven. It will create a lot of jobs. The new Oceanarium will also help to compete against Macau's new Water theme park - Chimelong, which I think is even better than Japan's Okinawa aquarium
See here http://oceankingdom-int.chimelong.com/Oceankingdom/EN/

Valuation wise, I think only if they win the new Japan casino license. Else, I will only pay 40 - 50 cents for this company. Because it's Cash flow generation ability is dropping around 10% per year (inflation adjusted).

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