Genting Singapore share stung by virus

In the final week of February 2020, Genting Singapore share price finally caved in, falling from $0.87 to $0.82. The reason for the fall was of course due to the horror plunge of Dow Jones in that week. Being part of the STI, it is no surprise that Genting Singapore share price turned bearish. But what is astonishing to me is that this counter had remained quite resilient in the face of the numerous headwinds the company faced.

Prior to the outbreak of the coronavirus, Genting Singapore share price had been grappling with the surprise increase in higher casino tax by 2022 and 50% increase in casino entry levies for Singaporeans and PRs effective 4 April 2019.

Genting Singapore share

It didn’t help that the trade war between US and China had lasted longer than expected. The fallout from the bitter war is the possibility of Chinese high-rollers unable to repay their gambling debts. As a result of the above two major headwinds, Genting Singapore share price fell from a high of $1.40 in late 2017 to the current $0.82 level. Despite the challenges, it appears to me that Genting Singapore share has found a strong support level at $0.80.

Note that this is an opinion article and not meant to be a financial advice. Please do your due diligence or engage financial advisors before investing in the stock market. Furthermore, I am not vested and have never invested in Genting Singapore share before. Whether Genting Singapore share price will surge or collapse has no impact on me. Thus, this article is not meant to induce readers to make any form of investment decisions.

Genting Singapore share bid sayonara to Osaka IR

Now, the integrated resort operator is facing another battle – the impact of the coronavirus. Given that Singapore government has barred all visitors from Mainland China effective 1 February 2020, the premium gaming segment is expected to be hit left, right and centre. Needless to say, Genting Singapore share price lost some ground since then.

The main reason for Genting Singapore share price holding up reasonably well could be the major catalyst that many investors are all waiting for – its bid for a Japanese integrated resort license. But in mid-February, the company dropped the bombshell that it is dropping its bid in Osaka. In my opinion, the Osaka IR could cause more harm than good for Genting Singapore share price. In this article, I will share three factors why Genting Singapore backed out from the Osaka IR bid.

Genting Singapore adventure in Japan came at a time when the Singapore IR operator risks becoming a one-trick pony. Traditionally, Genting Singapore is reliant on high rolling Chinese premium players. Back in 2014, the Group was forced to retrench 400 staff as a result of China’s slowing economy and government crackdown on graft. Thus, the move to diversify its premium gaming customers is long overdue. Winning a Japan IR license will be a major game-changer for Genting Singapore and the impact should not be underestimated.

First factor: Osaka’s Universal Studios is the biggest [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]

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Updated: March 24, 2020 — 1:26 pm

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