Analysts Slammed Genting RWS’ Poor Show

Posted: August 16, 2011 in Uncategorized

16th Aug 2011   Tue

Extracts & commentary of Singapore local news reports  

It’s not surprising that now analysts start to slam Genting RWS’ poor show over their 2nd quarter casino revenue.

A couple of months ago as reported by Professional Ground Decoder that Genting RWS had used huge over-credit strategy and Pseudo Junkets to try building up analysts perception & expectations of their casino. It’s a matter of time that such foolish tricks (churning) back-fired. Yet it’s not surprising that this could happen to Genting RWS.  Because they are rather used to short-cut approaches. 

Apparently Sands has done something right this time round, build its market share on a more solid platform – International Players Network and valued mass-market patrons.  At this juncture, Marina Bay Sands’ casino operational and marketing systems would have been sorted out and moving in high-gear.

Professional Ground’s rating for Genting stock – “Sell Some” (at least).

Over-credit & Pseudo Junkets ?!

  1. citi says:

    From July 2011 to August 2011, Genting Berhad bought in a total of 18 million of GenSP shares.Never ever totally trust analyst reports.

  2. citi says:

    GenSp FY2011 net profit estimated to be $1.1billion without junket operation.If junket operation was to be factored in ,it will make lot of difference.And i have not included the subsequent opening of Marine life Museum/Aquarium/Transformers/Spa/Villas/Hotels that will bring in more revenue in FY2012.Many of you will wonder how will the junket operation boost GenSp profit.I can tell you it will make a huge difference.About 60%-65% of Casino revenue come from the high rollers while the rest are fr mass market.However GenSp will be pursuing premium players market instead as we can see RWS had to suspend free shuttle bus service to RWS due to a uproar from locals.

    From the last AGM 2010 ,they mentioned of pending the approval of 30 junket operators by CRA.And these junket operators have very good connections with rich/wealthy ppl and they build lasting relationship with these high rollers so they are able to bring these ppl from over all the world to Singapore to gamble.And because of Singapore’s low gaming tax,high rollers will be lured to here to gamble and the commission the junket operators can earn is much more attractive than other Casinos in the world because Casino operators can pay them higher commission to the junket operators as the cost of running business here is lower.And again we can see ppl apply fundamentals analysis for this stock like PE too high ,EPS is too low ,overvalue and etc.Nothing wrong with it but this is a money spinning business ,very different from other business which sold products or services.

    Genting Berhad will be increasing it stakes in GENSP shares in the near future,fr the amount of shares they bought in July confirm this sign.

    We can also see the costs of running this business to go up as RWS are completing the final phase of its development but it will be manageable.

    Frankly speaking ,this is a gaming industry and this industry sell one thing ; Dreams.Dream of becoming rich/becoming richer .And even with economic downturns,this industry is not much affected as Casino earning come mainly from the rich.And ppl really under estimated the income of the junket operators which can bring to Casinos.Abt 60% -70% of Macau’s Casino revenue come from junket operators,we can see a great price leap in GenSp shares once junket operation is approved 。Hopefully by this year.

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