3Q21: Future Brightening Up

GENS’ 3Q21 results came in below our expectation as EBITDA fell 30% qoq due to lower revenue generation, however it still outperformed rival MBS (EBITDA -86% qoq). Nevertheless, GENS remains a compelling economic reopening beneficiary as the COVID- 19 pandemic eases, and could eventually look to enhance its capital management following the recent scrapping of its Yokohama IR bid. Target price: S$1.08.


• Lacklustre 3Q21 results… Genting Singapore’s (GENS) 3Q21 results revealed that Resort World Sentosa’s (RWS) gaming revenue decreased significantly (-13.9% qoq) from 2Q21, but still outperformed rival Marina Bay Sands’ (MBS) qoq gaming revenue decline of 35%. GENS also reported adjusted EBITDA of S$102m (-31% yoy; -31% qoq) in 3Q21. 9M21 EBITDA represents only about 69% of our full-year forecasts.

• …as the nation returns to Phase 2 Circuit Breaker. GENS’ 3Q21 decline in gaming revenue and weaker EBITDA reflected reduced operating capacity (two players per gaming table, alternate slots and electronic table games machines) in the quarter. Nevertheless, steady support by local patronage allowed GENS to deliver a profit despite the absence of international footfall without meaningful border relaxation.



• A compelling economic reopening beneficiary. Despite an uninspiring 3Q21, we remain confident that GENS is charting the course for a strong recovery pace in 4Q21. To note, the tourism sector is a main beneficiary to the upcoming economic reopening as the COVID-19 pandemic eases, taking cue from the recoveries in the US and the UK after the mass dispensation of COVID-19 vaccines there. Moving forward, we expect GENS’ valuations to partially factor in earnings recovery and business normalisation in 2022.