The Bank of Russia unexpectedly maintained its key interest rate at a record-high 21% , defying analysts’ expectations of another significant hike as inflation remains stubbornly elevated. The decision marks a shift toward a more measured approach in balancing economic growth and price stability. Key Details Inflation Concerns: Annual inflation climbed to 8.9% in November, well above the central bank’s 4% target , with inflation expectations reaching 13.9% in December. Policy Rationale: The central bank cited the significant tightening of monetary conditions after October’s 200-basis point hike as sufficient to resume disinflationary processes. Governor Elvira Nabiullina emphasized avoiding both economic overheating and severe slowdowns. Economic Overheating: Elevated government spending on the war in Ukraine and social programs, coupled with labor shortages and rising wages, have fueled strong domestic demand, exacerbating price pressures...
Visits to Genting Bhd's Resorts World Genting (RWG) have not yet returned to pre-pandemic levels, despite a stronger second-quarter performance, according to Phillip Capital. Revenue for the second quarter of FY2024 (2QFY2024) grew by 3%, and core net profit rose 15% year-on-year (y-o-y), supported by an increase in tourist visitations due to visa-free travel.
Key Takeaways:
Growth in Revenue and Profit: RWG saw hilltop visitations reach 5.9 million in 2QFY2024, an 11% y-o-y increase, with a significant number of tourists from Singapore. In the US, Resorts World Las Vegas recorded revenue of $218 million and EBITDA of $50 million. Overall, Genting’s EBITDA for 2QFY2024 rose 10% y-o-y, with an improved EBITDA margin due to reduced losses in investments.
Improved Financial Performance: For the first half of FY2024, Genting's core net profit, excluding impairment and fair value losses, increased by 145% y-o-y to RM884 million, reaching 52% of Phillip Capital's full-year forecast. Revenue for the same period was RM14.3 billion, up 15% y-o-y, driven by stronger performances from Genting Singapore (+26% y-o-y) and Genting Malaysia (+14% y-o-y).
Valuation and Outlook: Phillip Capital maintained a 'buy' rating for Genting, with a target price of RM5.90, despite slightly lowering its FY2024-FY2026 earnings per share estimates by 2%-3%. The stock trades at a favorable valuation of five times FY2025 enterprise value/EBITDA, suggesting it is undervalued.
Potential Upside and Risks: Successful commercialization and listing of TauRx could provide further upside. However, risks include lower-than-expected win rates, rising operational costs, and potential declines in both gaming and non-gaming revenue.
While RWG continues to recover from the pandemic, the pace remains moderate, and further growth may depend on external factors such as tourism and global economic conditions.
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