- Genting Malaysia Bhd (GenM) announced that it has submitted a US$1mil application fee to the New York State Gaming Commission. The application fee allows GenM to participate in the selection process to develop and operate a gaming facility in New York State.

- GenM is currently evaluating the project and will have until 30 June 2014 to decide if it wishes to submit a bid.

- It appears that GenM might be competing with Empire Resorts Inc for a casino licence in upstate New York in the future. Empire Resorts operates the Monticello Gaming and Raceway racino. Empire Resorts is 61.5%-owned by Kien Huat Realty, Tan Sri Lim Kok Thay’s family trust.

- According to news reports, Empire Resorts is pitching a complex, which includes a 391-room hotel, conference centre and 70,000 sq ft gambling floor. Previously, it was reported that Monticello and EPR Properties have teamed up to propose a US$750mil casino at the old Concord Resort Hotel.

- GenM has not decided on the site of the casino yet but is in talks with potential land owners. Monticello’s proposal would place its casino near Catskills. The old Concord Resort Hotel is just south of Catskills Mountain.

- Depending on the location, the minimum licensing fee for the upstate casinos is expected to range from US$20mil to US$70mil. We believe that the upstate casinos will have to pay 25% of their gross gaming revenues to the state of New York versus 70% for the racinos currently.

- A comparison would be Las Vegas Sands Corporation’s Sands Bethlehem Casino in Pennsylvania. Sands Bethlehem recorded average win per table of US$3,104 and average win per slot machine of US$262 in FY13. The casino had an average of 145 gaming tables and 3,043 slot machines in FY13. EBITDA margin was 20% to 25%.

- Maintain HOLD on GenM. New York Gaming Commission will decide on the winning operators by fall 2014, which implies the months of September to November. 

Source: AmeSecurities