KUALA LUMPUR: Higher vaccination rates are expected to improve visitorship and hasten the opening of the Genting SkyWorlds (RWG), which in turn would benefit Genting Malaysia Bhd (GenM).
RHB Investment Bank Bhd (RHB Research) said although visitorship has yet to reach pre-pandemic levels, the situation would likely improve as the opening of RWG could be a crowd-puller mainly for its facilities, potentially leading to higher-than-expected visitor arrivals.
"After being closed for more than four months, the crowd at SkyAvenue was encouraging even though it has yet to reach pre-pandemic levels.
"Many cars were seen driving up to the hilltop while there were long queues the cable car area and some F&B outlets at SkyAvenue."
The bank-backed research firm said once the indoor theme park reopens, it will attract more patrons to visit RWG, boosting its non-gaming revenue.
"Coupled with the higher vaccination rate and declining Covid-19 cases, confidence to travel should gradually recover and this will likely lead to stronger earnings recovery moving forward."
The theme park was ready to commence operations anytime soon and believe it could happen in November, which will be timely to capture the pent-up demand post reopening in the run-up to the year-end holidays.
"The theme park is situated on 26 acres of land, with nine themed worlds in it – there are 26 family-friendly rides and attractions."
RHB Research has made no changes to GenM's earnings estimates and recommended a 'Buy' call with a target price of RM3.58 as the stock could be a prime beneficiary of economic reopening and rebound in domestic tourism activities.
"We believe the trajectory for earnings will reach an inflection point and the imminent opening of Genting SkyWorlds will also create excitement, aside from the novelty effect – potentially leading to higher-than-expected visitor arrivals to RWG."