Genting Singapore +2.9%; Disposal No Surprise -DB

Genting Singapore (G13.SG) is +2.9% at S$2.16 before its 1Q11 results due Thursday post-market, and after saying earlier its wholly-owned subsidiary, Palomino, will sell its entire 11.03% holding in Rank Group (RNK.LN) for 150 pence/share. Deutsche Bank says the disposal should not be seen as a surprise as Genting Singapore sold its U.K. business to sister company Genting Malaysia (4715.KU), rated Buy, in 2010. "These Rank shares were held as short-term investments and marked to market every quarter. The sale will not have any significant impact on P&L." It notes Genting Singapore will rake in proceeds of S$130.5 million, largely offset by a forex loss as the SGD strengthened vs the GBP; thus there's "no material impact" on SOTP or its S$2.43 target price. For 1Q earnings, Deutsche Bank expects strong EBITDA of S$500 million (+31% on quarter) on 20% revenue growth to S$944 million. It keeps its Buy call and cites key risks as regulatory changes and lower-than-projected market-size growth. Orderbook quotes suggest strong resistance at S$2.18-S$2.19. (matthew.allen@dowjones.com)