Analysts at banking group Nomura predict that Malaysia is close to reopening its borders to selected foreign tourists soon as the vaccination rate continues to rise.
Malaysia.- As Malaysia continues to increase its vaccination rate, the country is close to allowing the arrival of “select foreign tourists” according to banking group Nomura.
Analysts say the news could be positive for Genting Malaysia’s Resorts World Genting. The casino venue has recently reopened on a limited basis and has said more facilities and offerings will be reopened once interstate travel is allowed.
The casino operator had closed all of its services in June after the Malaysian Prime Minister announced a nationwide Covid-19 lockdown. Until then, the resort’s hotels, food and beverage outlets, shopping malls, retail outlets and other facilities remained open.
Authorities have recently announced the resume of outbound overseas travel for fully vaccinated people and the resume of interstate domestic travels.
Analysts at Nomura said: “We expect the recent recovery in Genting Malaysia’s share price to continue, as the Malaysian resort is now open to interstate travellers, setting the stage for a fourth-quarter earnings recovery.”
Genting Malaysia reported gaming revenue for the first half of MYR1.14bn, down 23.3 per cent year-on-year due to the closure of its venue. Revenue was up by MYR155.7m when compared to the previous year.
Genting outlook could be upgraded in six to nine months
Fitch Ratings has kept Genting’s credit outlook at “BBB-” due to uncertainty surrounding the Covid-19 pandemic but says that could change in the next six to nine months if vaccination rates in key markets remain on track.
According to Fitch, Genting is expected to reduce its leverage level from six times this year to four times in 2022 and three times in 2023. It is also expected that comprehensive EBITDA will reach 80 per cent of 2019 levels in 2022 and full recovery in 2023.