Genting Malaysia Receives Positive Outlook with Maintain BuyGenting Malaysia Receives Positive Outlook with Maintain Buy Phillip Capital has reiterated its “buy” rating for Genting Malaysia Bhd (GENM) with a target price of RM3.45, citing the company’s strong performance in its gaming machine business. GENM’s gaming machine operations in New York continue to excel, with its market share rising to 43.3%. Phillip Capital anticipates the approval of a casino license for the US mainland by December 2025, which is likely to boost the company’s performance. According to the New York State Gaming Facility Location Board, the application deadline for three casino licenses is June 27, 2025. The licenses are expected to be awarded no later than December 31, 2025. Phillip Capital estimates an additional RM250 million to RM320 million in EBITDA contribution in 2026, assuming 200-250 tables are established in the first year of operation. GENM’s VGM properties in New York witnessed a 5.5% increase in net income for the second quarter of 2024, exceeding the state’s overall growth. The research firm maintains its earnings outlook for GENM, highlighting its high dividend yield of approximately 6.8%. Phillip Capital believes the company is an attractive investment opportunity due to its low enterprise value/EBITDA multiple of 6.6x in 2025. Potential risks include fluctuations in win rates, tax increases, and transactions with related parties. However, Phillip Capital remains optimistic about GENM’s prospects and encourages investors to take advantage of the current share price weakness.
KUALA LUMPUR (July 24): Phillip Capital has maintained its ‘buy’ rating on Genting Malaysia Bhd (KL:GENM) at RM2.57, with an unchanged target price of RM3.45. The company said the casino group’s gaming machine (VGM) business continued to outperform its New York-based rivals, with its market share growing to 43.3%.
In a statement on Wednesday, the research firm expects a casino license for the US mainland in New York to be granted by the end of December 2025.
Phillip Capital reported that the New York State Gaming Facility Location Board recently updated the timeline for applications for three casino licenses.
The application deadline is set for June 27, 2025, followed by the Community Advisory Committee vote on September 30, 2025.
“A decision is expected to be made no later than December 1, 2025, and the permits are expected to be awarded no later than December 31, 2025.
“We see this as a positive development and believe it would serve as a catalyst for a revaluation with a more definitive timeline.
“We had previously forecast an additional RM250 million to RM320 million EBITDA contribution in 2026, assuming 200-250 tables are set up for the first year of operation,” the house said, referring to earnings before interest, taxes, depreciation and amortisation.
The research firm highlighted that GenM’s VGM properties in New York, including Resort World New York City (with Nassau OTB) and Resorts World Hudson Valley, reported combined net income growth of 5.5% year-over-year in the second quarter of 2024, outpacing New York State’s overall growth of 4.3%.
“Overall, we expect improved performance from the US business, which accounted for 18% to 20% of GenM’s group revenue and EBITDA in 2023,” the house said.
Phillip Capital left its earnings outlook for GenM unchanged, saying the casino operator remains the best bet in the sector given its high dividend yield of around 6.8%.
“We continue to encourage investors to invest on a weak share price as GenM trades at an undemanding 6.6x enterprise value/EBITDA in 2025.
“The main risks associated with our call include lower than expected win rates, an increase in gambling taxes, pressure from key partners and value-destroying transactions between related parties,” the House said.
