Fitch Ratings raises Genting Berhad’s outlook for 2024 and 2025

Neha Soni September 25, 2024

Fitch Ratings has affirmed Genting Berhad (GENT) and its subsidiary Genting Overseas Holdings Limited’s (GOHL) Long-Term Issuer Default Rating (IDR) as ‘BBB’. Whereas the group’s other subsidiary, Resorts World Las Vegas LLC’s (RWLV) IDR, was rated as ‘BBB-‘. The outlooks remain stable for all the ratings.

International travel rebounds

The ratings agency has raised revenue forecasts for GENT, where it anticipates a return to 2019 levels by 2024 and 2025. This will be driven by the noticeable rebound in domestic traffic and increase in international tourists.

Fitch’s ‘BBB’ ratings denote that the company’s expectations of default risk are currently low. This comes despite RWLV currently facing an ongoing disciplinary complaint filed by the Nevada Gaming Control Board regarding various regulatory violations against the company, its parent company, and affiliates.

Moreover, in Singapore, Genting Singapore Limited’s revenues are estimated to reach pre-COVID levels, propelled by an increase in international visitors facilitated by visa-free travel arrangements.

In addition, Fitch has affirmed the rating of GOHL’s $1.5 billion senior unsecured notes due 2027 at ‘BBB’. Whereas ratings on RWLV’s $1.75 billion senior unsecured notes due in 2029, 2030 and 2031 and on its senior secured credit facilities at ‘BBB-‘.

Genting’s revenue stream

Commenting on the IDR of the group, the rating agency said, “GENT’s IDR reflects its status as the sole casino-licence holder in Malaysia, whose high share of domestic visitors provides a consistent and predictable revenue stream.

“Furthermore, Genting Berhad holds a strong position in Singapore’s competitive gaming market. The company’s diverse gaming assets in the US and the UK, along with cash flow from non-gaming sectors such as palm oil and energy, enhance its financial stability.”

Genting Berhad’s current rating comes as Fitch expects the group’s proportionately consolidated EBITDA net leverage ratio to remain below 3.5x from 2024.