Genting Can Monetize Assets For NY Licenses: Analysts

Global casino operator Genting Malaysia Bhd said in a note on Friday that it would "work to monetize its core assets" as part of a commercial casino licensing bid in downtown New York.

Genting Malaysia is one of some of the big gaming operators with Asian locations including Las Vegas Sands Corp, MGM Resorts International and Wynn Resorts Ltd., linked to the New York licensing bid.

"Other bidders have guided investments as high as $5 billion," said Samuel Yin Sao Yang, an analyst at Maybank.

"Genting Malaysia did not say how much it planned to invest (in New York) but said it would work to monetize non-core assets such as Miami properties worth $1 billion (we assume at $500 million) before relying on rights issues," he added

This information was provided by Genting Malaysia's management in a private conference call with investment analysts after the company reported fourth-quarter earnings.

Genting Malaysia operates Resorts World Genting, the only licensed casino property in Malaysia. The group also operates casinos in the U.S., the Bahamas, the U.K., and Egypt through related businesses.

In January, the New York State Gaming Commission launched an application (RFA) process request for three game licenses in New York State.

Launched by New York authorities, the RFA outlined a $1 billion minimum requirement for licensing fees and capital investments, with $500 million to be paid in licensing fees within 30 days. The relevant casino permits will range from 10 years to a maximum of 30 years, depending on the size of the investment promised.

Many investment analysts have suggested that Genting Group could be a leader in upstate New York licenses. The group already operates an electronic gaming facility called Resorts World Casino New York City and invests in Empire Resorts Inc., which operates a full-service casino World Catskill in upstate New York.

In a note on Friday, Maybank lowered Genting Malaysia's core net income estimates for 2023 and 2024 by 11% and 7%, respectively.

The bank now expects the casino company to post 10.14 billion yuan ($2.29 billion) in revenue this year, up 17.9% year over year in 2022. Earnings before interest, taxation, depreciation and amortization (EBITDA) could rise 37.1% year over year to 3.26 billion yuan in 2023, the agency suggested.

Moody's Investors Service Inc expressed some "risks" from Genting Group's "strong desire to expand its gaming franchise in the United States," given that "such projects could consume significant operational and financial resources" two weeks ago.

BY: 파친코