The revenue picture for mass-market gaming in Macau continues to improve, with Morgan Stanley analysts projecting the segment could almost equal revenues for 2019, before the Covid-19 pandemic shut down the city (it did not fully reopen until January).
According to GGRAsia, the April numbers were “circa 100 percent” of pre-pandemic levels, the MS team said. They raised gaming industry estimates “again” after monthly gross gaming revenue (GGR) came “stronger than consensus expectations for two consecutive months.”GGR reached MOP14.72 billion (US$1.83 billion) in April, up 15.6 percent from March, and 449.9 percent from the prior-year period, according to official data.
“We believe visitation recovery—April was 64 percent of the pre-Covid level—will continue to drive revenue recovery,” wrote Praveen Choudhary, Gareth Leung and Stephen Grambling in a May 2 note to investors.
“We now expect 2023 mass GGR of US$19.9 billion (88 percent of 2019) and 2024 mass GGR of US$25.7 billion (114 percent of 2024),” said the analysts.
Factoring in the VIP segment, the team expects GGR in Macau to hit 63 percent and 80 percent of 2019 levels this year and next.
Analysts from JP Morgan Securities (Asia Pacific) said the Macau GGR numbers are “looking great, despite frustratingly weak stock momentum,” referring to a recent downturn in share prices of Macau’s gaming concessionaires.
In the first three days of May, which were part of the city’s annual Labor Day holiday, JP Morgan estimates that daily GGR was as high as MOP900 million. That indicated that mass-market gambling had “recovered to at least 90 percent-plus of pre-Covid levels, if not 100 percent-plus” during the five-day holiday, which was “much higher than 65 percent recovery” in the first quarter.
In related news, Macau International Airport has resumed a number of overseas flights, including Seoul-Macau flights operated by South Korean budget carrier Jin Air Co., and flights connecting Macau and the Philippines run by Cebu Pacific Air. Starting July 1, low-cost carrier Tigerair Taiwan Co will resume flights. And on July 10, budget carrier Thai Vietjet Air will amp up the number of weekly flights between Macau and Bangkok’s Suvarnabhumi Airport.
