Genting Wants RM1.25b From Shareholders. Why?

A big company asking for your money

Genting sells RM28.8b a year. Now it wants RM1.25b from its shareholders.

When the plan came out on 9 October 2026, the share price fell 23% in one day, to its lowest in about twenty years.

So: should shareholders worry, or does this make Genting stronger? And if you own 1,000 shares and don't pay in, what happens? That part is worked out below.

Selling more, earning less

Revenue went up. Profit went from RM929m to a RM186m loss.

Revenue was RM27.1b in FY2023 and RM28.8b in the last 12 months. Over the same years, profit went from RM929m to a loss of RM186m.

A big part of the answer is interest. The group pays about RM2.11b a year to its lenders. The RM1.25b it is asking for covers only about 7 months of that.

Think of a house loan: your salary pays the bank first, and what's left is yours. Out of every RM100 of Genting's operating profit, about RM57 goes to interest.

My rule: operating profit should be at least 5 times the interest to feel safe, and under 2 times is a warning. Genting's interest cover is 1.74×. It's one reason the score is 24 out of 100, with Financial Safety at 17.

RM17.6b of cash. Why isn't it enough?

Debt due within a year: RM9.68b. On paper the cash covers it.

First, much of that cash isn't the parent's. Genting owns stakes in listed companies such as Genting Malaysia and Genting Plantations, and those have other shareholders. Cash inside them reaches Genting only as dividends.

Second, more money is going out. Genting Malaysia is expanding its New York casino. Group spending on plants and buildings went from RM2.74b in FY2023 to RM6.03b. After that spending, cash from the business (free cash flow) went from RM4.78b to minus RM0.37b.

When cash runs short, you borrow. Debt due within a year went from RM2.77b to RM9.68b, about 3 times as much.

Where the RM1.25b goes

About RM86 of every RM100 fills holes. RM0 goes to new business.

RM1.25b sounds like a lot. Next to the RM9.68b due within a year, it's about 1/8. Here is how the company plans to spend it, scaled to RM100:

This money is for filling holes. Which raises the next question: why not just borrow it?

The company says the amounts can still change.

Why not borrow from the bank?

Borrowing more would make the debt problem bigger.

Back to the house loan. If most of your salary already goes to the bank and you ask for another loan, the bank looks at you harder. In September 2026, Fitch cut Genting Malaysia to BBB-, the lowest investment grade. Borrowing RM1.25b more at the group's average rate (about 4.4%) would add roughly RM55m of interest a year.

A rights issue is different. Money from shareholders has no repayment and no interest. That sounds good, but it isn't free. The cost the company avoids moves to the shareholders.

What it means for your 1,000 shares

Pay in, sell your rights, or do nothing. Two of the three shrink your slice.

In a rights issue, the company sells new shares to existing shareholders, in proportion to what they hold, at a discount. The final price and ratio aren't set yet; shareholders vote on the plan first.

The company's example price is RM1.30, about 1 for every 4 shares you own. With 1,000 shares, you could buy 250 new ones for RM325.

• Pay in: your slice of Genting stays the same size.
• Sell your rights on the market: you get a little money back, and your slice shrinks.
• Do nothing: the rights expire, you get nothing, and your slice shrinks.

The catch: RM1.30 was worked out when the share price was RM1.88. The company's rule is that the new shares are priced 25% to 30% below the average of old and new shares together. At today's RM1.45, that rule gives a price of about RM0.92 to RM1.01. To still raise RM1.25b, it would need about 1 for every 3, and your slice would go to about 75. The lower the share price, the more new shares, and the thinner your slice if you don't pay in.

The Kien Huat group, which holds 45.1%, has committed to pay in for its share, so Genting is likely to get the money. The decision left is yours: pay in, sell, or do nothing. None of them is right or wrong; it depends on your money and your view.

The "today's price" figures are my own working from the company's pricing rule, assuming it still raises RM1.25b. They are not the company's numbers and will move with the share price.

Does Genting come out stronger?

The company gets a little safer. Each share doesn't get stronger.

Whether this rights issue is worth it doesn't depend on the RM1.25b itself. It depends on whether the New York spending brings in more money in a few years.

What to check next time a company asks for money

Two checks.

My own answer for Genting: the company gets breathing room, but shareholders haven't seen the payoff yet. The score follows my rules; set your own weights and see where Genting lands. Or open Genting's stock page for every number behind its 24.

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