Genting Malaysia Bhd, owner of Resorts World Casino New York City, fell to a one-week low in Kuala Lumpur trading after the Florida legislature postponed a vote on a bill to expand casino gambling in the state.
The stock dropped as much as 2.2 per cent to RM3.92, the lowest intraday level since Jan 31. It traded at RM3.93 at 12:03 pm local time. Its parent Genting Bhd, which controls Asia’s second-biggest casino operator by market value, lost as much as 1.6 per cent. They were the top two worst performers on the FTSE Bursa Malaysia KLCI Index, which gained 0.9 per cent.
Genting Malaysia’s plan to build a US$3 billion casino resort overlooking Miami’s Biscayne Bay stalled when a Florida House of Representatives committee delayed a vote on the bill, leaving little chance for lawmakers to approve the issue before the end of the legislative session March 9.
“This is a negative surprise,” Loke Wei Wern, an analyst at CIMB Group Holdings Bhd, wrote in a report today. “This regulatory roadblock does not mean that casino gaming in the state is completely ruled out. But it does mean a longer wait for Genting Malaysia and other gaming companies hoping to penetrate Florida.” Loke kept her “outperform” rating with a price estimate of RM4.80.
Its Florida project, known as Resorts World Miami, would include four hotels, two residential towers and a 3.6 acre rooftop lagoon on land it agreed to buy from Miami Herald newspaper’s publisher McClatchy Co. in May, Genting Malaysia said on Sept 15. A casino would be included if Florida’s legislature and governor approve, it said.
The project’s development period may take “considerably longer” should the state’s legislature vote against the bill, CIMB’s Loke said. “The gaming element is still the project’s key appeal and we expect a retooled casino bill to make a comeback in future legislative sessions.” -- Bloomberg
The stock dropped as much as 2.2 per cent to RM3.92, the lowest intraday level since Jan 31. It traded at RM3.93 at 12:03 pm local time. Its parent Genting Bhd, which controls Asia’s second-biggest casino operator by market value, lost as much as 1.6 per cent. They were the top two worst performers on the FTSE Bursa Malaysia KLCI Index, which gained 0.9 per cent.
Genting Malaysia’s plan to build a US$3 billion casino resort overlooking Miami’s Biscayne Bay stalled when a Florida House of Representatives committee delayed a vote on the bill, leaving little chance for lawmakers to approve the issue before the end of the legislative session March 9.
“This is a negative surprise,” Loke Wei Wern, an analyst at CIMB Group Holdings Bhd, wrote in a report today. “This regulatory roadblock does not mean that casino gaming in the state is completely ruled out. But it does mean a longer wait for Genting Malaysia and other gaming companies hoping to penetrate Florida.” Loke kept her “outperform” rating with a price estimate of RM4.80.
Its Florida project, known as Resorts World Miami, would include four hotels, two residential towers and a 3.6 acre rooftop lagoon on land it agreed to buy from Miami Herald newspaper’s publisher McClatchy Co. in May, Genting Malaysia said on Sept 15. A casino would be included if Florida’s legislature and governor approve, it said.
The project’s development period may take “considerably longer” should the state’s legislature vote against the bill, CIMB’s Loke said. “The gaming element is still the project’s key appeal and we expect a retooled casino bill to make a comeback in future legislative sessions.” -- Bloomberg
