Saturday, September 18, 2010

SGX : Genting Hong Kong Limited

Was chatting with an old time friend today about some of the counters he's been looking at. Thing is, he's more into long term investing while I'm more into short-term trading. Anyhow, it's always nice to be able to learn more about any good counters.

The past 1-2 weeks have been the weeks for Genting Hong Kong Limited. The share price have rocketed from $0.31 to $0.51 and volume have been at an all time high. As I usually do not like looking at penny stock counters, I must admit I've completely let this one slip off the hook.

So a little bit of digging research done over the weekend yields this :
- Company owns 3 main businesses : Star Cruises - AP, 50% Norwegian Cruise Lines (NCL) and 50% Resort World Manila (RWM).
- The real potential of this company is RWM which is opened only in Aug 2009 and is currently only 55% completed.
- To date, only 200 tables and 1200 slot machines are operational in the casino. RWM has license to operate up to 2000 tables and 7000 slot machines. RWS have 530 tables and 1300 slot machines.
- Total cost of developing RWM is estimated to be US$550mil comparing to RWS initial estimate of S$5.2bil.
- Profit of RWM for last quarter ending June is approx US$10mil. Profit for RWS for last quarter ending June is approx S$390mil.

RWM definitely has the potential to be very successful once they are fully operational if they can fill up the tables. The initial development cost is a fraction compared to RWS and I think RWM have a pretty strong call to break even before RWS does. Genting Hong Kong Limited is definitely a new counter I'm going to monitor. I believe it will not be a penny stock in the near future.

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