Sydney portal snares incoming Chinese
An expected boost in Chinese visitation to Australia could be of special benefit to the Star Casino, because most Chinese tourists enter the country through Sydney, where the resort is located, according to a Morgan Stanley forecast reported in the Asia Gaming Brief.
Star, formerly Echo Entertainment, outperformed the ASX200 by 36 percent in 2015 due to an increase in global VIP play and its monopoly in Brisbane, the report said.
From now until 2020, Morgan Stanley forecasts a 15 percent increase in compound annual growth for Chinese tourism in Australia; that growth could jump to 17 percent from 2020 to 2025. The analysts also predict that spending by Chinese tourists will rise from AU$5 billion (US$3.5 billion) to AU$13 billion by 2020.
Morgan Stanley gave Star Entertainment a positive outlook due to its finalized license in Brisbane and improving returns, the report added.
However, the Sydney Morning Herald reports that both Star and its chief rival, Crown Resorts, could be “casualties” of China’s campaign to tighten foreign currency transactions.
“There has been this idea that a good chunk of the lost VIP revenue from Macau would simply find a new home in places like Australia,” an industry source told the Herald. “But if China wants to stem the flow of money, it’s not just Macau that is on the block. Casinos in Australia will also have to check their expectations.”
