Genting shares fall 17% to lowest since 2007 after RM1.25 billion rights issue

Shares of Genting Bhd sank to their lowest in nearly two decades on Monday, 12 October 2026, after the gaming conglomerate proposed a RM1.25 billion rights issue to pare down its borrowings, The Edge Malaysia reported.

How far the shares fell

• Genting fell as much as 32 sen, or 17%, to RM1.56, its lowest level since April 2007.
• Nearly 58 million shares had changed hands by the midday break.
• The slide wiped more than RM1 billion off the company's market value, leaving it at about RM7.4 billion.
• Intraday short selling of Genting shares was suspended for the rest of Monday, an automatic step when a stock falls more than 15% or 15 sen from its reference price.
• Listed subsidiary Genting Malaysia Bhd was dragged down too. It was 20 sen, or 13%, lower at RM1.29 at the midday break.

What Genting is proposing

This is Genting's first-ever rights issue. According to the company's Bursa Malaysia filing, reported by The Star on Friday, 9 October, it is a renounceable rights issue. The issue price, entitlement ratio and entitlement date have not been fixed. The board plans to set the price at a discount of 25% to 30% to the theoretical ex-rights price.

• RM800 million will go towards repaying borrowings within 12 months, which is expected to save RM41.3 million a year in interest.
• RM429.5 million is for working capital and corporate needs.
• Major shareholders Kien Huat Realty Sdn Bhd, Kien Huat International Ltd and Datuk Lim Keong Hui have undertaken to take up their full entitlements, covering 45.1% of the target (RM563.8 million). The rest will be fully underwritten.

Why Genting needs the money

Genting's latest financial statements show total borrowings of RM45.25 billion against cash and cash equivalents of RM17.64 billion. Short-term borrowings, which fall due within 12 months, have more than doubled to RM9.68 billion since the end of 2025.

In September, Fitch Ratings cut Genting to BBB-, the lowest investment grade, following earlier downgrades by Moody's Ratings and S&P Global Ratings. Public Investment Bank said the downgrades had raised Genting's funding costs, so a rights issue may be a cheaper way to raise capital and fund operating expenses, given heavy capital commitments, particularly for Resorts World New York and Resorts World Sentosa in Singapore.

What analysts say

Analysts expect sharp dilution to earnings and dividends per share.

• CIMB Securities warned of more selling pressure. "Nobody likes a rights issue," it said, adding that investors see such exercises as swapping cheaper debt for more expensive equity.
• Maybank Investment Bank downgraded the stock to a non-consensus "sell", seeing minimal interest savings and only a two-percentage-point drop in net gearing. It did not rule out more fundraising such as private placements, and expects lower dividends while Genting rebuilds its cash.
• Public Investment Bank cut its target price by 35 sen to RM2.00.

Genting now has four "buy", seven "hold" and one "sell" calls. The average 12-month target price is RM2.38, based on the 12 analysts tracked by Bloomberg.

What happens next

In a rights issue, existing shareholders are offered new shares in proportion to their holdings, and those who do not subscribe see their stake diluted. The final price and ratio will be announced later. The Star reported that Genting aims to complete the exercise in the first quarter of 2027.

Sources

• The Edge Malaysia, Genting falls 17% to 2007 lows after over RM1 bil cash call
• The Star, Genting proposes RM1.25bil rights issue to pare down debt, boost working capital