-  According to news reports, Genting Bhd has provided medical software developer CorTechs Labs, Inc with financing to support the company’s growth. According to sources on the Internet, the size of the funding was US$1.2mil.

-  CorTechs is the developer of a leading software solution for the quantification of volumetric brain atrophy, which can help diagnose a variety of brain disorders. The software NeuroQuant is used by hundreds of neurologists, radiologists, and clinical researchers in the world.

-  Bloomberg reported that the funding given to CorTechs by Genting Bhd will help accelerate the development of CorTechs’ industry-changing image analysis software and expand its sales and marketing initiatives.

-  We are neutral on this development. The size of funding of US$1.2mil is not large.

-  This is not Genting Bhd’s first foray into pharmaceuticals. Genting Bhd has also been investing in associate stakes in various companies in the past.

-  In December 2013, Genting Bhd bought an 8.4% in Linc Energy for S$57.4mil. Linc Energy has a portfolio of oil, gas and coal assets and underground coal gasification technology.

-  In November 2012, Genting Bhd invested US$111.8mil in a 20% stake in TauRx Pharmaceuticals. In 2010, Genting Bhd acquired a 20% stake in Union Bank of Colombo, Sri Lanka for RM27mil.

-  We believe that Genting Bhd’s company level cash is more than RM1bil. We reckon that the cash reserves would be used to partly finance the Banten Power Plant in Java, which will cost RM1bil.

-  In addition, we believe that part of the cash would be allocated for the equity portion of the “Resorts World Las Vegas” project. Phase 1 of the project is estimated to cost US$2-3bil.

-  Maintain HOLD on Genting Bhd.

Source: AmeSecurities