Kenanga lifts Genting Malaysia discount after Empire Resorts restructuring plan
Analysts cite improved governance and cost savings as Empire prepares asset sales and Genting Malaysia targets a New York casino licence.
Key points:
– Kenanga Research removes 20% valuation discount on Genting Malaysia
– Empire Resorts to sell $525m in non-gaming assets to strengthen balance sheet
– Funding gap remains ahead of Resorts World New York City expansion bid
Kenanga Research has removed the 20% discount it previously applied to Genting Malaysia Berhad’s valuation, citing stronger governance and restructuring efforts at its US subsidiary, Empire Resorts.
The move follows the group’s announcement of a $525m plan to divest non-gaming assets and reduce debt.
The restructuring will see Empire Resorts sell properties including the Resorts World Catskills hotel, Alder Hotel, golf course, event centre and restaurants to Sullivan County Resort Facilities Local Development Corporation.
The proceeds will be used to acquire the land beneath these assets and redeem US$300m in outstanding bonds.
Kenanga said the transaction demonstrates greater financial discipline as Genting Malaysia prepares to bid for a full casino licence in New York. The operator requires an estimated $5bn to expand Resorts World New York City (RWNYC) into one of the country’s largest casinos and the state’s biggest hotel complex.
With a gearing ratio of 84% and net debt of RM10bn ($2.3bn), the company has limited borrowing capacity, leaving a $2–3bn funding gap despite the planned restructuring.
Good to know: Redeeming Empire’s $300m bond is expected to save around $22.5m annually in interest costs
Other analysts remain cautious. Hong Leong Investment Bank maintained a “hold” rating with a RM1.82 target price, noting the proposals are still at an early stage.
CIMB Securities raised its target price by 10% to RM2.15, highlighting reduced debt but continuing to assign zero equity value to Empire Resorts due to weak gaming performance and uncertainties over 1,554.6 acres of recently acquired land.
If Empire achieves breakeven, CIMB estimates Genting Malaysia’s earnings per share could rise by more than 50% in FY2026–27.
Market consensus currently values the stock at RM2.01 a share, with 18 of 19 analysts maintaining price targets around that level.
The developments build on Genting Malaysia’s earlier announcement of Empire Resorts’ restructuring plan in August, which included the asset sale, land purchase and bond redemption. The measures aim to make Empire debt-free and secure its long-term position in the New York gaming market.
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