The group’s overall weaker performance y-o-y can be attributed to Singapore seeing stronger visitorship and tourism spending during last year’s Chinese New Year festive season along with the relaxation of visa regulations between China and Singapore in February 2024.
On the same day as its 1QFY2025 business update announcement, Genting Singaporeannounced the retirement of its CEO of the company and RWS Tan Hee Teck. His retirement is a personal decision, and Tan's departure from all his executive and board roles held in the group will be with effect from May 31. Lee Shi Ruh, who has been with
the group for 15 years, will be appointed as the new CEO of RWS, while Tan Sri Lim Kok Thay, GENS’ current executive chairman, will assume the role of acting CEO.
See more: Genting Singapore’s 1QFY2025 earnings down 41% y-o-y to $145 mil; CEO Tan Hee Teck retires
Following the announcements, analysts are keeping a cautiously optimistic view on GENS.
DBS Group Research is keeping its "buy" call, but is still reviewing its target price. In its previous Apr 24 report, DBS had a target price of 95 cents on GENS.
With adjusted Ebitda of $236 million, accounting for 22% of DBS' FY2025 overall estimates, GENS is currently tracking below expectations, compared to the pre-COVID first quarter contribution range of 25–29%.
"The outlook may remain challenging, with Trump’s tariff policy adding a layer of macroeconomic uncertainty across the region. Nonetheless, we believe the company remains on track to deliver a stronger 2HFY2025, supported by the launch of multiple new attractions in early the third quarter — a period that has historically been seasonally strong pre-Covid," says DBS, while expecting growth to pick up from 3Q2025 with the opening of WEAVE, Oceanarium and The Laurus luxury hotel.
See also: DBS downgrades Venture to 'hold'; Maybank raises target price following trade war truce
While the leadership transition appears abrupt in terms of timing, it may be linked to CEO Tan’s increasing involvement in national initiatives such as the Singapore Economic Resilience Taskforce. "We expect the company to commence a formal search for a new CEO, but do not anticipate any major shift in strategic direction, particularly with regard to existing capex plans," adds DBS.
On the other hand, UOB Kay Hian (UOBKH) is keeping its "buy" recommendation, but lowering its target price of 90 cents from $1.12 previously. For analyst Jack Goh, the recent 1QFY2025 results were also below expectations.
Goh notes that Singapore’s tourist arrivals posted healthy growth trajectories in 1Q2025, thanks to recent mutual visa exemption agreements and festivities. This is despite slower visitations in March which have normalised from a high base in 1Q2024, which featured Taylor Swift’s Eras Tour’s.
However, he remains cautious on macroeconomic headwinds and intensifying competition. "Despite remaining optimistic on higher visitations throughout 2025, we assess that consumer sentiment and average spending in RWS may be negatively affected by economic uncertainty from US’ volatile tariff policies which may impact business volume from regional countries such as China and Indonesia," says Goh, adding that RWS’ competitor Marina Bay Sands’ (MBS) has a structurally more strategic city-center location and the recent completion of its renovation of its about 1,850 hotel rooms may continue to pose stiff competition for RWS.
Hence, the way Goh sees it, the full launch of RWS 1.5 with multiple crowd-drawing attractions is an important re-rating catalyst, such as Illumination's Minion Land in Universal Studios Singapore, Oceanarium and its Waterfront development.
As for the CEO's resignation, Goh sees limited impact. "We opine that the change of helm has a limited impact on GENS, given that both Lim and Lee are already well involved in GENS’ daily operations and business strategies," he says.
With resilient cashflow delivery, Goh anticipates that management now has more flexibility to better utilise its sizeable capital which includes net cash of $3.58 billion as of 4QFY2024. "Although the group has indicated its interest to potentially participate in the bid of a Thailand integrated resort (amid legalisation), we do not rule out the possibility of higher dividend payouts given the sizeable cash pile," says Goh.
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On the other hand, Maybank Singapore is reiterating its "buy" call and $1.01 target price on GENS.
The 1QFY2025 earnings we in-line with analyst Yin Shao Yang's estimates. Core net profit in 1QFY2025 of $150.3 million (-40% y-o-y, +5% q-o-q) was within expectations at 25% of Yin's full-year estimate. As a secondary check, 1QFY2025 revenue of $626.2 million (-20% y-o-y, +2% q-o-q) and 1QFY2025 Ebitda of $235.8 million (-36% y-o-y, +5% q-o-q) were also in-line at 26% and 24% of Maybank's full-year estimates respectively.
"Going into 2Q2025, we expect operations to be seasonally slower post-Chinese New Year in 1Q2025. We do not get the feeling from management that the short lived trade war between the US and China had a marked impact on VIP volumes in 2Q202," says Yin.
He adds: "Going into 3Q2025, we expect operations to be stronger. Then, the Singapore Oceanarium will open and so will the 183-suite The Laurus hotel. The latter is especially important as it will add to room inventory to house VIP and premium mass players."
As at 10.00am, shares in GENS are trading 3.4% lower at 71 cents.
