• With the land vaccinated travel lane between Malaysia and Singapore suspended, we expect Genting Singapore (SGX:G13)'s earnings to be flattish for yet another year. Longer term, we expect competition for its premium mass market to intensify.
• We cut our FY22E/FY23E core net profit forecast for Genting Singapore by 72%/54%. Consensus estimates are aggressive, in our view.

2022 Chinese New Year Likely Another Quiet One

• Initially, we were positive on the land vaccinated travel lane (VTL) between Malaysia and Singapore. We estimate that Malaysians contributed 20-30% to RWS’ VIP volume and 30-40% to RWS’ mass market GGR pre-COVID-19 when ~250k Malaysians entered Singapore by land daily. Unfortunately, the land VTL was suspended on 23 Dec 2021.
• With no guarantee that it will resume, we fear that not many Malaysians will gamble at the Singaporean IRs during the peak Chinese New Year period.

Competition for Premium Mass Market to Intensify

• The arrest of Macau’s junket ‘king’, Alvin Chau, has plug the aforementioned gap when borders reopen. Competition from Cambodia will be most intense, in our view.

Cut FY22E/FY23E Core Net Profit by 72%/54%

• With FY21E having passed, our FY21E estimates are unchanged. Given the above, we cut our FY22E earnings forecast for Genting Singapore by 72% as we now do not expect GGR to recover materially this year.
• Essentially, we HOLD call.
• In our view, consensus earnings estimates are aggressive.

Source: Maybank Kim Eng Research - 17 Jan 2022