GENTING SINGAPORE PLC

Do some info finding on Genting Singpore PLC, found out some point that make me have to reconsider to buy in.. hahaha..

I think no need to talk about the history of this company la, the main project now for her is the IR (Integrated Resort) in Singapore Sentosa lol. On top of this, GS also involve in the Casino business in UK (currently she is the largest investor in UK for casino gaming business) and this is the only business that she is operating now (correct me if I'm wrong). Any how, the business is in loss due to decrease of the customer and the changes in the tax system done by UK gov. In April, UK gov has revised and increase the tax for the casino machine and this was expected to bring the losses of 268M SGD for GS (for coming few FY).

In terms of the company current status hor, of cause la operating in losses as the main income from UK casino business is losing profit. And for the IR project, the debt is extremely high now, GS has become the company that having the highest debt in hand among all the listed company in SGX. The total debt for GS as of 1st Q'09 is at 2498M! Long term debt is 2183M and short term debt is 314.74M. EPS surely is negative d (-0.33 SGD), NTA stay at 0.29 SGD.

The high debt in GS are mainly used for the investment in IR project, total investment for IR had reached 65.9B. To prepare this kind of huge money for the IR project, GS has announced 2 times of right issues (2005 and 2007) and the rest is from the bond by total of 6 banks. Mr. Lim has done an estimation 2 years back where the GS is only able to make profit after 7 years of IR operation. this statement was made on 2007/08 and during that time the debt is far away less then today, so how long it needs to recover all the debt accumulated until today? Any how, we know that the losses surely will be covered after IR start to operate early next year.

In terms of the casino business in S'pore, the country had made their own law for this which is the Singaporean or PR have to pay $100 per entry per day into the casino, the ppl that allow to enter the casino also must fulfil a few of criteria that set by the S'pore gov where ppl who are bankrupt and still rely on gov. support for their daily life are not allowed to enter the casino. So after the gov. filter here and filter there, i think the main customer for IR will be the foreigner. As seen in some research, the main profit contributor for Genting Malaysia and Macau casino are those local guys and not those visitor or foreigner from others country (~70% are from local). I think in the 1st few years after the GS start to operate the main income should be coming from the theme park rather then the casino, we will verify this from their quarter or annual report soon *V*!

How bout that license for the casino in S'pore? Generally, GS already get it from the gov. but in my point of view, before the casino start to operate, there will still some hidden chance for changes, why?? As we all know, Mr. Lim had disposed 9% of his holding in GS lately, as also known by all of us, he plan to enter the MGM and further his step to move into Macau casino business. Who is the Dai Ko in Macau?? Mr. Ho lol, and we all know that S'pore gov. really "bo su ka" this Mr. Ho, this we can see from the S'pore casino license tender during 2006/2007 where GS plan to work with Mr. Ho for Macau casino business and she almost loss in the license tender because the S'pore gov disagree with GS to work out with Mr. Ho. This time, Mr. Lim sold his GS share and invest in Macau, surely the S'pore gov. will have some action on this (i expect la), i would put in some risk there for GS due to Mr Lim's action.

Talk about the management, I really don't like the style of Mr Lim la, before this, he had soled 2 US online casino company which is under his name to Resort World, this 2 companies are actually operating under losses and yet he still buy it with Resort from him self. And for the latest 9% share disposition in GS because he want to enter MGM, i not really agree on this. Y? because the bond issued by MGM with the DY of ~10% is to cover the high debt of MGM, MGM is running losses and Mr. Lim still buy in his bond, i really don understand la... haha, Luckily he buy in MGM with his own money, if he use GS to buy like what he did on Resort, for sure the company no future d.. haha.

Any how, IR will start her soft launch in early 2010, let us see what will be at that time. Will GS become the next legend like Genting?? i think the chance is low because Mr Lim not same like his father. I really doubt on his capability (looking at his annual salary korek from Genting share holder already sian... haha) maybe i'm worng oso, haha. But for the IR investment in Singapore, it really can make money if the chairman is old unker Lim.

So how now? buy or not buy? I'm not a market analyser nor a business man, i cannot seen the future for a business and i have less experience. I can say that GS is in high debt because they not yet start operate the IR, things will get better once the IR start to operate. For GS, the UK business for me is dead, the only chances for GS to make money is the IR. For IR project, the resort and theme park sure will bring profit for GS, for casino business ler, if everything remain unchanged, it should be positive but if S'pore gov shows his mood, than will be another story.

For GS at this time, I prefer trade as a treader rather then an investor, if you look at the debt and -EPS, its already not in good situation (high risk), BUT!! I oso worried that will run chicken if all the things are heading positive. Btw, nothing you can get from the FA analysis now because GS is not doing any business now (the one and the only is in loss now *V*!) . Early next year, GS share price surely will up another round with the soft launching of IR, but don miss understand that the situation is getting better, this huge among of debt will need some year to be recovered.

The actual performance of GS only can be know after the IR start to operate. I will prepared to buy in some at anything below 0.68, hold until the 1st and 2nd Q after IR start to operate, then will decide what to do for the next step. I believe GS's share price will not come down to < 1 after IR start to operate.

Btw, i didn't buy in anything yet when she is below 0.65 last week because i not yet summarize all the info i have, now i think I'm ready to do that already. This GS is not same like AIG or Citi where US gov will not let them die, it have only the strong mother which is Genting Bhd, and Genting Bhd is control by our dear Mr. Lim now, you have to understand how Mr. Lim run his business, remember, not his father now. Wish me good luck *V*!!