Genting Berhad: An Asset-Rich but Return-Poor Giant

Value Investing Case Study 104-1: A fundamental analysis of Genting to assess its value case and see why, while it has defensive moats, returns are weak.   

Genting Berhad is one of Asia’s most recognisable names in leisure and hospitality. Over the past decade, the Group has expanded into a diversified conglomerate spanning resorts, plantations, energy, property, and even life sciences.

Revenue grew modestly at 4.4% annually, but profits in 2024 were still 10% lower than in 2015. A closer look at costs tells an interesting story. Post-2020, Genting’s fixed cost base has structurally shifted upward. This reflected new assets like Resorts World Las Vegas and ongoing expansions. Unless revenue keeps pace, these higher fixed costs risk becoming a long-term drag.

Yet Genting’s strengths should not be overlooked. Its moats – regulatory barrier, intangible assets and distribution reach - are real. There is also scale and cost advantages across its 10+ integrated resorts and 18,000+ hotel rooms. Against global peers Genting ranks as a mid-tier player. 

So, what should investors make of Genting? It clearly has the scale and the brand equity to remain a formidable player in global gaming. 

But the critical question is whether management can turn those strengths into sustainable shareholder value. Without that, Genting risks remaining more of a defensive cash generator than a true growth compounder.

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If the above article was useful, you can find more insights on how to make money in my e-book. The e-book is now available from Amazon, Kobo and Google Play.

PS: If you are in Malaysia or Singapore, the e-book can only be download from Kobo and Google Play. 

Disclaimer & Disclosure

I am not an investment adviser, security analyst, or stockbroker.  The contents are meant for educational purposes and should not be taken as any recommendation to purchase or dispose of shares in the featured companies.   Investments or strategies mentioned on this website may not be suitable for you and you should have your own independent decision regarding them. 

The opinions expressed here are based on information I consider reliable but I do not warrant its completeness or accuracy and should not be relied on as such. 

I may have equity interests in some of the companies featured.

This blog is reader-supported. When you buy through links in the post, the blog will earn a small commission. The payment comes from the retailer and not from you.

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