Genting Malaysia Tumbles on New York Plan: Kuala Lumpur Mover
Genting Malaysia Bhd. (GENM), owner of Resorts World Casino New York City, fell the most in three months in Kuala Lumpur trading after Citigroup Inc. said plans by New York to expand casino gambling in the state is “negative” for the Southeast Asian company.
The stock sank 3.7 percent to close at 3.61 ringgit, its steepest decline since Oct. 10. Genting Malaysia, based in Kuala Lumpur, was the biggest decliner on the FTSE Bursa Malaysia KLCI Index (FBMKLCI) today, which fell 0.1 percent. Its parent Genting Bhd. (GENT) slipped 2.4 percent, the most since Nov. 14.
New York Governor Andrew Cuomo proposed to build up to three casinos in upstate New York to help revitalize the economy and boost tourism in the upstate, according to his third State of the State address in Albany on Jan. 9.
“We believe the three casinos will be full-fledged with table games but Resorts World New York will probably remain a slot-only racino,” Citigroup analysts led by George Choi wrote in a report dated yesterday. “Allowing table games at Resorts World New York would likely cannibalize the three casinos in upstate New York, which would work against the government’s attempt to help the economy in upstate.”
They maintained their buy call on Genting Malaysia with a price estimate of 4.50 ringgit, saying that it’s the cheapest gaming stock in Citigroup’s coverage.
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