Genting Gains Most Since 2010 on Licenses: Singapore Mover
Genting Singapore Plc (GENS), Asia’s second-biggest gaming company, rose the most in 18 months after the Casino Regulatory Authority awarded two junket licenses in Singapore that may lure high spenders to casinos.
Genting rose as much as 8.6 percent to S$1.77, the biggest intraday gain since Sept. 13, 2010 in Singapore trading. The stock pared gains to close 6.8 percent higher, outpacing a 0.4 percent increase in the benchmark FTSE Straits Times Index. Its Malaysian parent Genting Bhd. (GENT) climbed 2.2 percent in Kuala Lumpur to 11 ringgit.
Two Malaysian operators won the first casino junket licenses in the island republic. The permits are valid for one year and the two so-called international marketing agents will only operate at Resorts World (HOT) Sentosa run by Genting Singapore, according to the CRA’s website. IMA’s are paid a commission by casinos to bring in foreign high rollers.
“It will bring in more customers into the casino, especially from the VIP segment,” Low Yee Huap, an analyst at Hong Leong Financial Group Bhd. (HLFG), wrote in a report today, referring to high-spenders. “We expect Genting Singapore to be able to experience better earnings growth going forward.”
Genting Singapore’s stock rating was raised to “outperform” by RHB Capital Bhd. (RHBC) analyst Hoe Lee Leng, meaning that the share’s return is expected to exceed the average among its peers. The stock was previously rated “market perform” by the brokerage.
“We are delighted with the licensing of International Market Agents in Singapore,” Robin Goh, a spokesman of Resorts World Sentosa, said in an e-mail to Bloomberg News. “This will bring economic benefits for both Resorts World Sentosa and Singapore.”
The company posted a S$265.7 million ($210 million) profit in the fourth quarter ended Dec. 31, compared with a S$150.3 million loss a year earlier. Genting Singapore’s shares have risen 15.2 percent this year, outperforming a 13 percent gain in the benchmark gauge.
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