NagaWorld expansion will help
Morgan Stanley is bullish on Cambodia’s gaming industry. According to the Phnom Penh Post, the U.S.-based investment bank says casinos in the country will post a 39 percent increase in 2016 VIP proceeds, even as VIP flatlines around the world. Though the worldwide VIP sector grew in the first quarter of 2016, that gain followed eight consecutive quarterly declines.
Cambodia posted a 174 percent increase in first-quarter growth for a total of $81 million—a performance that helped to push the global sector into the plus column. Bank data indicated that the “VIP market outside Macau is gaining relevance” as a global share of revenue.
CIMB analyst Michael Ting said Macau’s loss has become Cambodia’s gain. “As there is more diversification away from Macau for VIP junkets, peripheral markets in the region will come to Cambodia,” he said. The opening of NagaWorld’ NagaCity Walk in 2016 and Naga2 in 2017 should keep the good times rolling in Cambodia.
Lorien Pilling, director of Global Betting and Gaming Consultants in the UK, said before the two-year recession in Macau, “Cambodia was not really positioned as a high-end VIP casino destination. The growth has come partly because of a repositioning of the Cambodian casino sector and also because it was starting from a low base.
“The Asian region has high VIP demand and low regulated supply to cater for it, so Cambodia should be able to sustain its growth, despite future competition from the Philippines and South Korea,” he continued.
But Ashish Patel, general manager of Titan King Casino in Bavet, said his property has not seen appreciable growth in VIP revenue. “That information is wrong,” he told the Post. “We have not seen an increase in VIP customers. And if there is, it is only in the Phnom Penh area.”