CreditSights: High debt, weak cash flow put Genting, Genting Malaysia at downgrade risk

Thursday 17 Sep 2026

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KUALA LUMPUR (Dec 3): Genting Bhd (KL:GENTING) and Genting Malaysia Bhd (KL:GENM) are facing increased risks of rating downgrades with parent Genting’s high debt and weak cash flow situation, according to CreditSights.

In a report on Wednesday, the Fitch Solutions company said Genting breached Moody’s and Fitch downgrade triggers for cash flow, leverage, and earnings before interest, taxes, depreciation and amortisation (Ebitda) based on the first nine months of 2025 (9M2025) pro-forma numbers.

“A rating downgrade of Genting by Moody’s and Fitch will bring it to Baa3/BBB-, with Genting Malaysia ratings tied to Genting,” said CreditSights. At present, both Moody’s and Fitch have placed Genting at Baa2/BBB ratings, while Fitch has a BBB rating on Genting Malaysia.

The research firm projected Genting’s retained cash flow-to-net debt could fall to 17%, below Moody’s trigger of 20% to 25%.

Genting’s gross leverage is at 5.9 times, above Moody’s four times trigger, and its Ebitda net leverage is over five times, above Fitch’s 3.5 times threshold.

“The situation is less clear at S&P (BBB-),” it added.

CreditSights said the credit ratings downgrade risk also affects Genting Malaysia because its ratings are tied to Genting’s and warned that its leverage could worsen from the front-loaded US$5.5 billion (RM22.71 billion) New York expansion costs that are largely debt-funded.

The research firm said Genting may narrowly avoid breaching Moody’s and Fitch triggers in FY2026 if the planned unused Miami land sale for US$1 billion goes through, but this is seen as unlikely.

“...we think the sale may be a long shot that both rating agencies may not be willing to factor in,” it said in its note.

CreditSights expects Genting Malaysia’s net leverage could worsen to highs of 6.0 times to 6.2 times by end-FY2026 (9M2025: 4.7 times) in the absence of the Miami asset sale.

Genting has secured 73.133% of Genting Malaysia shares at the close of its RM2.35-per-share offer on Dec 1 — below the 75% threshold required to delist the company.

CreditSights was surprised by strong shareholder support for Genting’s takeover bid given the unattractive offer price but sees Genting Malaysia’s privatisation as unlikely, saying the goal is to strengthen control, not delist. Genting was expected to increase its stake to 60%-65%.

The research firm kept its "market perform" recommendation on Genting and an "outperform" call on Genting Malaysia.

CreditSights said Genting has good geographical and business diversification outside of gaming and expects the company's earnings to pick up at the Singapore, UK, and Las Vegas units. The research firm also highlighted Genting's access to its cash-rich Genting Singapore subsidiary.

At the closing bell on Wednesday, Genting’s share price pared some of its losses to settle at RM3.27, down two sen or 0.61%. Earlier, the stock fell as much as 2.12% or seven sen to RM3.22. At RM3.27, Genting is valued at RM12.68 billion. The stock is down 15% this year.

Meanwhile, Genting Malaysia’s share price fell six sen or 2.67% to RM2.19, giving the company a market capitalisation of RM13 billion. Year to date, the stock is down by 3.1%.

Edited ByPresenna Nambiar

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