0M now the sweet spot, says Sheng
When it comes to attracting significant investment in its emerging casino industry, the Vietnam government may have inflated the value of the jurisdiction by well over $1 billion, according to one consultant who spoke to the Asia Gaming Brief.
The government is now considering draft legislation for the country’s casino industry, and has actually cut the original minimum investment from $4 billion to $2 billion. It’s still out of line, said Sam Sheng managing director of Double Square Consulting (Macau).
“For the current market conditions, no more than $250 million is the investment that people are willing to take the risk to invest,” Sheng told AGB. “(When) you have all the rules and regulations in place with local gaming, the metro area etc., then you can ask for $4 billion.”
Sheng confirmed he is working with investors who have expressed interest in Vietnam, and added that relying on incoming Chinese VIPs is not the key to long-term success in the market. “We are looking at two segments that we think are both profitable and sustainable,” he said. “We are looking at the younger generation of the Chinese middle class, and the second is the local Vietnamese.”
For that reason, an estimated 65 percent of revenues should yield from non-gaming sources, he recommended.
