Tuesday, January 28, 2014

Genting Hong Kong - Lower earnings and price target; still a value play (DB)

Genting Hong Kong -
Price at 20 Jan 2014 (USD) 0.42
Price target - 12mth (USD) 0.54
Lower earnings and price target; still a value play

Deep value and plenty of cash – what's next?
At a 37% discount to market SOTP, Genting Hong Kong remains a deep value stock with nearly US$1.0bn gross cash after paring down its stake in NCLH. The Lim family raised its stake to 58.1 %, or 75.9% including that held by Genting Malaysia.


We see dividends, M& A and fleet rejuvenation as ways to deploy cash. We trim our TP to US $0.545/sh given our earnings cut but maintain Buy.

Cash up significantly; Lim family raises stake
GENHK raked in close to US$738m in 2013 by paring down its stake in NCLH to 31.4% (from 50%).

Given its projected near US$1.0bn gross cash, GENHK has various options including, but not limited to,(1) a fleet renewal program given the average fleet age of 21 years; (2) M&A; and/or (3) pay a dividend.
It is interesting to note that major shareholder Tan Sri KT Lim & Family has raised its stake to 58.1%, from 55.6% previously (ex GENM’s 17.8% stake).

Asian cruise earnings affected by lower holds; earnings trimmed
We understand from our recent meeting with GENHK that 2013 gaming operations in Asian cruise remained robust but profitability was affected by lower VIP holds and a tough comparison given above-theoretical hold in FY12. Coupled with lower associate contribu tions following the NCLH placements, we have lowered our FY13-15E core NP by 54%, 22% and 18% respectively. Lower gaming accounted for most of the FY13E cut while NCLH made up 40- 50% of the reduction in FY14-15E earnings. RWM, which also suffered low hold in 2013, may see a disappointing FY13 given the typhoon effect in Q4.

Trades at 37% discount to ma rket SOTP of US$0.66/share
Following our cut in Asian cruise earnin gs (c.11% SOTP), we lower our DB SOTP to US$0.64, from US$0.67. Our SOTP values NCLH at DB TP of US$34, Travellers on 11.7x FY14E EV/EBITDA (o r DCF), Asian cruise on 5x EV/EBITDA. We peg our 12-TP at a 15% discount to DB SOTP, which implies a fully diluted PER of 17.2x (vs a historical average of 15.3x).

Risks: economic downturn in Asia or globally; slower-than-projec ted Philippines gaming market growth.



Source/Extract/Excerpts/来源/转贴/摘录: Deutsche Bank
Publish date: 22/01/14

No comments:

Post a Comment

Warren E. Buffett(沃伦•巴菲特)
Be fearful when others are greedy, and be greedy when others are fearful
别人贪婪时我恐惧, 别人恐惧时我贪婪
投资只需学好两门课: 一,是如何给企业估值,二,是如何看待股市波动
吉姆·罗杰斯(Jim Rogers)
“错过时机”胜于“搞错对象”:不会全军覆没!”
做自己熟悉的事,等到发现大好机会才投钱下去

乔治·索罗斯(George Soros)

“犯错误并没有什么好羞耻的,只有知错不改才是耻辱。”

如果操作过量,即使对市场判断正确,仍会一败涂地。

李驰(中国巴菲特)
高估期间, 卖对, 不卖也对, 买是错的。
低估期间, 买对, 不买也是对, 卖是错的。

Tan Teng Boo


There’s no such thing as defensive stocks.Every stock can be defensive depending on what price you pay for it and what value you get,
冷眼(冯时能)投资概念
“买股票就是买公司的股份,买股份就是与陌生人合股做生意”。
合股做生意,则公司股份的业绩高于一切,而股票的价值决定于盈利。
价值是本,价格是末,故公司比股市重要百倍。
曹仁超-香港股神/港股明灯
1.有智慧,不如趁势
2.止损不止盈
成功者所以成功,是因为不怕失败!失败者所以失败,是失败后不再尝试!
曾淵滄-散户明灯
每逢灾难就是机会,而是在灾难发生时贱价买股票,然后放在一边,耐性地等灾难结束
  • Selected Indexes 52 week range

  • Margin of Safety

    Investment Clock

    World's First Interactive Investment Clock