Singapore Stocks-Down on losses in telcos, 3,000 support eyed

Reuters - Tuesday, September 7Send IM Story Print


* Index down 0.32 pct, seen in 3,000-3,042 range afternoon

* SingTel, StarHub and M1 drop on fears of new competition

* SingTel falls ahead of announcement on new Australia govt

By Charmian Kok

SINGAPORE, Sept 7 - Singapore shares dropped 0.32 percent, weighed by losses in telcom operators after a newspaper reported the government may allow a fourth mobile phone operator in the city-state.

By the midday break the Straits Times Index <.FTSTI> was down 9.73 points at 3,024.85. More than 131.8 million shares had changed hands.

"Singapore shares are likely to trade sideways later this afternoon, as there's little movement in U.S. futures so far. As the U.S. was on holiday yesterday, the STI is mainly taking its cues from Japan, which is down," said Carey Wong, an analyst at OCBC Investment Research.

The benchmark index is likely to trade with a downward bias in the 3,000-3,042 band, traders said.

Shares of Singapore's three telcom operators fell on Tuesday after the Business Times reported Singapore will auction another third-generation spectrum in November, paving the way for a fourth mobile phone operator. [ID:nSGE68601F]

Singapore Telecommunications was also hit by uncertainty ahead of the announcement of Australia's new government, which is expected later Tuesday.

SingTel shares fell 1.6 percent to S$3.06 with 10.5 million shares changing hands, StarHub dropped 2.8 percent, while M1 declined 1.3 percent.

"If the opposition party wins, this may be bad news for SingTel, as the new government may not spend as much on broadband infrastructure in Australia," said a local trader.

Australia's conservative opposition said last month it would scrap the current government's plan to build a high-speed broadband network if it won, which could have negative implications for SingTel's Australian unit Optus. [ID:nSGE67901G]

Singapore-listed casino operator Genting Hong Kong fell 3.4 percent to S$0.425 as investors pared holdings in the firm after its shares surged 47 percent over the last two trading sessions. [ID:nSGE68603U]

Genting Hong Kong +18.3%; Eyes on Manila gaming

Written by The Edge


Friday, 03 September 2010 13:03

Genting Hong Kong (S21.SG) +11.7% at new 52-week high of US$0.355 ($0.478) on strong volume as players turn attention from sister company Genting Singapore (G13.SG) to cruise operator, hopeful it could also enjoy latter’s gaming success given its 50% stake in Resorts World Manila, says Dow Jones.

“Since RWM’s entry (in 2009), the overall Philippines gaming market has more than doubled year to date. This is another example of new properties growing gaming markets rather than cannibalising the existing pie,” says a broker.

Casino cash may inject $1.5 bln into Singapore annually-DBS

On Thursday 26 August 2010, 16:15 SGT


SINGAPORE, Aug 26 (Reuters) - Revenues from two new casino-resorts could contribute as much as S$2 billion ($1.47 billion) annually to Singapore's economy, which is expected by the government to grow by up to 15 percent this year, DBS Bank said on Thursday.

The two resorts have already contributed S$470 million or 0.3 percentage points to gross domestic product (GDP), which grew 17.9 percent in the first half of 2010 from a year earlier, DBS economist Irvin Seah wrote in a report.

"If the GDP contributions by the integrated resorts continue to rise at the same pace going forward, we can expect full-year GDP contributions of about S$2 billion from these projects," Seah said in the note.

That would translate into adding 0.7 percentage points to GDP for the whole of 2010, he said.

Singapore is counting on the two resorts opened earlier this year by Malaysia's Genting Bhd and Las Vegas Sands to help fuel tourism and economic growth. It hopes to double visitor arrivals to 17 million by 2015.

In July alone, at least 1 million people visited Singapore, the highest number the city-state ever saw in a month, after seven consecutive months of record monthly visitor arrivals.

"However, the contributions derived from the GDP statistics reflect only the direct impact of the IRs. The overall economic gains to the economy are likely to be significantly larger if the spinoffs to other industries are taken into account," he said. ($1=1.358 Singapore dollar) (Reporting by Nopporn Wong-Anan; Editing by Kim Coghill)

Genting Malaysia faces down stockholder revolt

Reuters - Wednesday, August 25Send IM Story Print


KUALA LUMPUR, Aug 24 - Genting Malaysia shareholders backed the company's move to acquire the UK casino operations of Genting Singapore in a 340 million pound deal despite a large number of votes against.

Shareholder revolts in Malaysia are rare and 38 percent of the stockholders voting disapproved of the move in the resolution put to Tuesday's extraordinary meeting.

"People wanted assurances over the next three years to come over Genting UK's profitability," said Genting's deputy chairman Mohammed Hanif Omar.

Genting Malaysia stock was down 2.23 percent at 3.07 ringgit at 0914GMT, underperforming a 0.l9 percent rise in the main Kuala Lumpur stock index <.KLSE>.

(Reporting by Fong Min Hun; Writing by David Chance; Editing by Niluksi Koswanage)

Singapore's Casinos Just Opened But They're Already Set To Knock-Out Las Vegas

It's been barely five years since Singapore announced that it would develop integrated casino resorts, yet already the island nation has become a serious rival to Las Vegas, with just two major casinos.


Second quarter 2010 winnings put Singapore on track to have a $4 billion casino market on an annualized basis according to the Wall Street Journal. That's just 20% shy of what Las Vegas is expected to do this year, and even Las Vegas is impressed:

WSJ:

"It's just proof that if you build it they will come and in Singapore they built two products that are worthy of that title," says Andy Nazarechuk, Dean of University of Nevada Las Vegas' Singapore campus.

"Las Vegas will continue to attract (Asian visitors) but instead of the player making two or three trips to Las Vegas in the year they may make only one trip and the other two trips may be more closer regionally."

Even the bears expect a substantial market size for Singapore:

Las Vegas-based gambling consultancy Galaviz & Company has relatively conservative forecasts for actual earnings in Singapore of $3.5 billion in 2011 and projects the Las Vegas strip will earn $5.8 billion, a modest improvement on the $5.1 billion expected in 2010.

And the bulls think Singapore could torpedo Las Vegas's market position within just the next few years:

However, some among the investment community believe the Singapore market will approach the sorts of numbers Galaviz expects for the Las Vegas strip, which accounts for about half of the state of Nevada's gaming revenue, by 2012.

Aaron Fischer of CLSA has some of the more bullish forecasts, expecting the combined gaming revenues of both Singapore resorts to generate $5.1 billion in 2011, up from his previous estimate of $3.9 billion. Goldman Sachs also expects the sector could bring in $5 billion in 2011.

Combined with the development of Macau, it seems like Las Vegas's leadership position could be toast over the next decade, even should the U.S. economy rebound well past its past peak. Las Vegas probably needs to roll out some heavy branding initiatives in Asia.

Note however that Steve Wynn, the founder of Wynn Casinos (WYNN), isn't waiting for any magic from the Nevada government. He's planting himself in Asia quite often, even if he's backed off from plans to move his HQ to Asia, realizing that Wynn's long-term success revolves around being a global company, like Hilton. It's not about being stuck in Las Vegas alone.

Thus it's not the U.S. casinos that need to be worried about the rise of Asian casino hubs per se, but more Nevada state. Nevada better move fast, given the ambition and well organized government efforts in Singapore and Macau. Heck, I've never been to Vegas, but I'm already dying to jump into Singapore's new infinity pool...

Now see jaw-dropping pictures of Singapore's casino-skyscraper infinity pool >

Singapore gaming may rival Las Vegas by 2012

Written by The Edge


Wednesday, 18 August 2010 16:24

Singapore’s very young gaming sector revenues could rival those from Las Vegas strip in next two years, according to some estimates, according to Dow Jones.

CLSA expects sector to generate US$5.1 billion ($19 billion) in 2011, which compares with Galaviz & Co.’s 2011 estimate of US$5.8 billion for Las Vegas strip for 2011.

Reflects weakness in gaming revenues in traditional US gambling Mecca of Las Vegas, especially as Asian players look closer to home at venues in Macau and now increasingly Singapore following opening of Las Vegas Sands’ (LVS) Marina Bay Sands and Genting Singapore’s (G13.SG) Resorts World Sentosa earlier this year.


“The appetite for gambling in Asia is significantly higher than it is outside of Asia,” CLSA analyst Aaron Fischer says.

Genting Singapore +8.2%; Hard to repeat 2Q10: Goldman Sachs

Written by The Edge


Monday, 16 August 2010 15:41

Genting Singapore (G13.SG) +8.2% at $1.58, extending Friday’s 14.1% rally, as players remain hopeful of earnings prospects, market share in Singapore after gaming group returned to profitability in 2Q10 with $396.5 million earnings, triggering slew of broker upgrades last week, says Dow Jones.

Volume less than half of Friday’s 682.8 million shares but still robust, making Genting most active stock in Singapore. Orderbook quotes suggest shares may test $1.60. While most analysts bullish, some still cautious, noting strong performance in 2Q10 unlikely to be repeated.

STI ends 0.2% lower at 2,933.51

Singapore’s Straits Times Index dropped 0.2% to 2,933.51 at the close. Two stocks declined for each that rose on the 30-member gauge. Shares on the measure trade at 14.2 times estimated earnings, compared with about 17.4 times at the beginning of the year, according to Bloomberg data. The following shares were among the most active in the market. Stock symbols are in parentheses after company names.


Genting Singapore Plc (GENS SP), the owner of one of two casinos in the city-state, surged 8.2% to $1.58, setting a fresh record closing price. The stock advanced 14% on Aug 13 as Credit Suisse Group AG, Citigroup Inc. and Morgan Stanley raised their stock recommendations after the company returned to profit in the second quarter.

Olam International (OLAM SP), a Singapore-based supplier of agricultural commodities, fell 0.8% to $2.54. Union Agriculture Group, a closely held Uruguayan landowner, plans to outbid Olam International for NZ Farming Systems Uruguay to gain control of the South American dairy farmer. Union Agriculture will make an offer of 60 New Zealand cents a share, valuing NZ Farming at NZ$147 million ($140.6 million), Christchurch-based NZ Farming said in a statement posted on the exchange. The offer is 9% higher than the 55 cents-a-share bid announced last month by Olam.

Wilmar International (WIL SP), the world’s biggest palm-oil trader, lost 0.3% to $6.11. The company had its share-price estimate cut to $7.50 from S$8.30 at DBS Vickers Securities while it maintained a ”buy” rating.

Aug 13: Genting, Noble, Sembcorp Industries, Wilmar

Written by Bloomberg


Friday, 13 August 2010 08:53

The following companies may have unusual price changes in Singapore trading today. Share prices are from the previous close. Singapore’s Straits Times Index dropped 0.8% to 2,927.04.

Shipping companies: The Baltic Dry Index of commodity-shipping rates rose 2.5% in London yesterday to its highest level since June 29.

Genting Singapore raised to Overweight by Morgan Stanley

Written by The Edge


Friday, 13 August 2010 10:19

Morgan Stanley upgrades Genting Singapore (G13.SG) to Overweight from Equalweight, raises target price to $1.60 from $1.06 after casino operator’s 2Q results top house’s expectations; results include first full quarter of earnings from Resorts World Sentosa, says Dow Jones.

Morgan Stanley raises both EPS, EBITDA estimates by 57%-88% for 2010, 2011, respectively.

“Further upside could come from increase in table count and junket introduction to drive VIP volume.” Says based on recent numbers, Singapore’s gaming market looks to be worth about US$4 billion ($5.4 billion).

Stock surges 11.7% to $1.43.

Upgrade to Buy: The Numbers Do the Talking - Citi

Surprising market size — Normalizing Resorts World Sentosa’s 2Q10 gaming

revenue and making it comparable to that earned by Marina Bay Sands during the
65 days it operated in 2Q10, we believe RWS had a market share of ~67% vs MBS’
~33%. We anticipate MBS to fight back and RWS to see its market share normalize
to ~60%, which implies that the two casinos could generate total gaming revenue of
US$3.8bn in 2011 (vs. our previous assumption of US$3.1bn).

 Blowout 2Q numbers — GENS reported revenue of S$860.8m and EBITDA of
S$503.5m during 2Q10, beating both our estimates and consensus of ~S$220m by
miles with a very robust 2Q EBITDA margin of 58%. Although management
attributed the strong results to a higher than average hold rate, we believe VIP
rollings and mass market drops also rose materially.

 Strong balance sheet — During 1H10, GENS drew down the remaining S$900m
from its syndicated loan facility to fund its construction of phase two at RWS. We
believe that the operator is now close to peak-CAPEX gearing level. On our
estimates, the operator’s 2010 debt-to-EBITDA multiple is a healthy ~3.5x, and the
ratio is expected to improve going forward, given the solid operating cash flows
generated from the casino. One concern on the B/S though is the rising accounts
receivable balance, which we believe is due to the increase in VIP gaming volume.

 Upgrade to Buy (1M) — We like GENS because, based on the data points available
to date, GENS apparently has the right casino product that appeals to the market
and will continue to dominate the Singapore market in the near term, in our view.
We continue to value the stock on a blend of DCF and SOTP (consistently on
Macau’s sector EV/EBITDA multiple of ~12.5x). Consequently, we raise our TP from
S$0.99 to S$1.55 and upgrade the stock from Sell (3H) to Buy (1M).

 We transfer coverage from Dominic Noel-Johnson to George Choi.

Genting Singapore rallied 14 percent to S$1.46

Genting Singapore rallied 14 percent to S$1.46, its highest level since listing in 1991. The casino operator reported second-quarter profit of S$396.5 million ($291 million) compared with a loss a year earlier. Credit Suisse Group AG, Citigroup Inc and Morgan Stanley raised their recommendations on the stock.