CIMB in an Oct 11 research report says: "While we are upbeat about Genting Singapore’s (GS) long-term prospects, we flag the risk of luck normalisation which could hit 3Q’s numbers.
"However, we retain our estimates which imply a $6 billion-8 billion gaming pie for 2011-2012 as there is potential for upside for GS from (i) the licensing of junket operators and (ii) prolonged market dominance.
"After (i) applying an unchanged 15% premium to its Macau peers’ higher target EV/EBITDA of 14x instead of 12.5x and (ii) rolling over our valuation horizon to end-2011, our SOP-based target price rises from $1.88 to $2.45.
"Factors that could catalyse the stock include (i) a speedier ramp-up, (ii) licensing of junket operators and (iii) sustained market leadership. OUTPERFORM."