Two brokerages forecast gross gaming revenue (GGR) in Macau casinos this month will see a marginal year-on-year increase.
Sanford C. Bernstein Ltd and the stockbroking arm of Nomura issued notes on the topic, based on GGR for the week ended November 11.
The brokerages suggest GGR will be in the range of MOP23 billion (about US$2.85 billion) to MOP24.1 billion this month.
The Bernstein note forecasts that GGR this month will be between MOP23.5 billion and MOP24.1 billion, or between 2 percent and 4 percent more than a year ago.
There has been some market discussion recently about the possibility of a year-on-year contraction in Macau market GGR at some stage during the fourth quarter.
The latest Bernstein forecast for November assumes average daily revenue of between MOP750 million and MOP780 million for the rest of the month.
Bernstein analysts Vitaly Umansky, Eunice Lee and Kelsey Zhu estimate that average daily revenue last week was about MOP840 million, as they expected, and that average daily revenue so far this month has also been about MOP840 million.
Referring to a recent trip to neighbouring Zhuhai in the mainland’s Guangdong province, by President Xi Jinping for the opening of the Hong Kong-Zhuhai-Macau Bridge, the Bernstein team wrote: “Visitation picked up after President Xi’s visit late October…”
A number of investment analysts have previously said that visits to Macau – or places nearby – by senior Chinese leaders to can have a moderating effect on volumes of gambling by Chinese using Macau casinos.
Bernstein’s note also mentioned the 11-day period covered in its memo also encompassed two weekends, “which also helped to boost numbers”.
The analysts estimated that VIP market volume so far this month had been about the same as last month; that the VIP market hold rate had been slightly higher than normal, and that mass-market revenue so far this month is slightly lower than last month.
Nomura’s note forecast that GGR this month would be between MOP23 billion and MOP24 billion, or roughly 2.5 percent more than a year ago. The forecast assumed GGR this month would rise sequentially in line with the trailing six-year median.
The note said Nomura’s Instinet research team of Harry Curtis, Daniel Adam and Brian Dobson estimated that average daily revenue last week was about MOP841 million. The analysts further forecast that: the average daily VIP-market volume is on course to be about the same as last month; the VIP market hold percentage will be just above the normalised range; and that mass-market average daily revenue will be about 5 percent lower than last month.
“Demand has gradually picked up since China’s President Xi visited the region late last month. In addition, we believe the higher-than-normal weekend-to-weekday ratio through the first 11 days also added about MOP28 million a day to the weekly GGR-per-day number,” Nomura said.
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"The MSAR [Macau Special Administrative Region] Government is always maintaining its policy not to have imported labour to work as dealers. This position has not changed"
Lionel Leong Vai Tac
Macau’s Secretary for Economy and Finance