Next month in Macau, market-wide gross gaming revenues (GGR) could match pre-Covid levels, according to JP Morgan analysts DS Kim, Mufan Shi and Selina Li. The investment team projects that GGR will reach 100 percent of 2019 levels, the year that’s served as a benchmark for the city’s pandemic recovery.
The optimistic outlook follows a September slump, in which GGR was affected by Super Typhoon Saola. The storm briefly closed borders, shut down transportation and shuttered casinos, making this a “month to forget” for the city’s operators. Citigroup’s George Choi and Ryan Cheung said the decline was also seasonal, and “the fact that September is sandwiched between the summer holidays and the National Day Golden Week in early October.”
According to Inside Asian Gaming, analysts also expect traffic to recover to 85 percent of 2019 Golden Week levels, with mass GGR back up to 100 percent of the prior period.
“Most investors will be satisfied if visitation recovery hits 85 percent-plus of pre-Covid levels,” the JP Morgan team wrote, “and our checks and recent visitation trends suggest there is little downside risk here.”
GGR in the Chinese gaming hub has increased every month since the city reopened in January. The numbers hit pre-Covid highs of MOP$16.66 billion (US$2.06 billion) in July and MOP$17.21 billion (US$2.12 billion) in August, per IAG.
In the premium mass segment, Choi and Cheung report that total wagers for September were down only 8 percent month-on-month to HK$8.8 million (US$1.13 million), with the average wager per player at HK$20,314 (US$2,560), 58 percent higher than in September 2019.
“Players are not going to be deterred by anything less than a direct-hit typhoon or a ‘black’ warning level rainstorm,” they wrote, adding that wagering “does not seem to be affected by the state of the Chinese economy.”
In addition, they noted the return of VIPs, the so-called “whales” who bet an average of HK$100,000 (US$12,790) per hand or more. Citigroup identified 17 of these high-value players in September, more than double the number in September 2019. Some of the big spenders wagered as much as HK$500,000 (US$63,950) per hand at the Chairman Club at Wynn Palace.
And two VIPs seated with 15 other players at Galaxy Macau’s Horizon Room brought the betting total to HK$980,000 (US$125,345) at that table.
According to GGRAsia, the Macau Government Tourism Office (MGTO) expects the city to welcome “over 100,000” visitor arrivals during the seven-day Golden Week holiday.
In other Macau news, Chief Executive Ho Iat Seng announced last week that the city’s Novel Coronavirus Response and Coordination Center would close, effective immediately. “Although novel coronavirus infection is no longer a public health emergency of international concern,” he noted, “it still poses a certain threat to human health, and the Health Bureau and other relevant departments will still take appropriate preventive and control measures according to the changes in the pandemic situation.”
