Genting Singapore Earnings: Strong Results Beat Our Expectations; Lifting Fair Value by 4%

We raise our fair value estimate of narrow-moat Genting Singapore to SGD 1.02 per share from SGD 0.98, following the firm’s strong first-quarter results with revenue and adjusted EBITDA well above its 2019 levels. The growth momentum is ahead of our expectations. We think the visa-free travel arrangement between China and Singapore—along with rising airline capacity from key client markets and successful lifestyle offerings—have boosted traffic and spending to Genting Singapore across gaming and nongaming segments. We increase our 2024-28 revenue assumptions by 10%-15% and adjusted EBITDA by 7%-11%, to reflect a stronger-than-expected growth outlook. We believe Genting Singapore's strong focus on premium lifestyle offerings and ongoing development of the RWS 2.0 project will further strengthen its competitiveness in regional markets and drive robust sales and profit growth in the mid to long term. We think the shares are currently undervalued.