KUALA LUMPUR (Aug 21): Genting Bhd's (KL:GENTING) shares fell nearly 5% on Friday morning after its second financial quarter ended June 30, 2026 (2QFY2026) came in below analysts’ expectations.
The counter declined to RM2.14 per share, valuing the group at RM8.3 billion, with some 7.16 million shares changing hands.
Meanwhile, the group's 74%-owned subsidiary Genting Malaysia (KL:GENM) saw its shares slipping 1.2% to RM1.71 per share after announcing a near 90% drop in net profit to RM47.4 million in 2QFY2026 from RM416.6 million in the same period last year.
Genting recorded a net loss of RM27 million from a profit of RM243.5 million in the same period in 2025, despite higher revenue of RM7.75 billion from RM6.78 billion the year prior. This was attributed to forex translation losses, as well as higher finance and operating costs.
Public Investment Bank noted that both performances fell well below its expectations, prompting it to cut its FY2026-FY2028 earnings forecasts for Genting and Genting Malaysia by an average of 18% and 11% respectively.
“The operating environment for the entertainment and hospitality industry remains challenging amid rising geopolitical tensions that restrict travel demand and increase operating costs,” said Public Investment in a note, which has a 'neutral' call on both stocks.
Hong Leong Investment Bank (HLIB) flagged that both the companies could face further decline from ongoing Iran war-related disruptions, such as higher airfares and potential flight cancellations, which may dampen discretionary travel demand to regional leisure assets.
Following the results shortfall, HLIB trimmed its FY2026-FY2028 forecasts for Genting by 31.2%/28.1%/25% respectively, mainly to reflect downward revisions for Genting Malaysia.
For Genting Malaysia, it cut its FY2026-FY2028 forecasts by 40.4%/29.8%/18.2% respectively to primarily account for lower Ebitda margins assumptions for both the UK and Egypt and the US and Bahamas operations.
HLIB kept its 'hold' call on Genting Malaysia with a lower target price of RM1.74 while downgrading Genting to 'hold' with a target price of RM2.02.