Thailand could move from a proposal for casino legalisation to industry implementation “as quickly and as efficiently” as the Singapore government did two decades ago, says Citigroup.
But a Thai industry could when “fully ramped” generate US$9.1 billion annually in gross gaming revenue (GGR), exceeding the performance of Singapore’s current duopoly, and “only behind Macau and Las Vegas”, stated analysts George Choi, Preenapa Detchsri, and Timothy Chau, in a report on the outlook for Thailand.
The institution was working from a presumption of two licences in the Thai capital, Bangkok, and one each in the vicinity of Pattaya, Phuket, and Chiang Mai, three places popular with foreign tourists.
A bill on the matter could be approved “as soon as mid-2025,” stated the analysts.
They added: “Deputy Finance Minister Julapun Amornvivat recently reiterated the Thai government’s intention to table a revised draft law … to the cabinet by end-2024. When the council of state approved the bill … the race for licences in Thailand will quickly commence.”
China International Capital Corporation (CICC) Hong Kong Securities Ltd estimated, in a January memo, that 2023 GGR in the Singapore market – a post-pandemic recovery year for the city-state’s tourism – was US$5.11 billion, up 56 percent year-on-year.
Regarding Thailand, “openings will probably be at least six years from now,” but a Thai market had the potential to “reshape the revenue pie of the global gaming industry,” stated Citigroup in its update.
The institution estimated that any international casino operator approved for an “entertainment complex” licence in Bangkok, could see its earnings before interest, taxation, depreciation and amortisation (EBITDA) increase by at least “15 percent”. Some might see a near-doubling for group annual EBITDA.
That view assumed “a 50:50 joint venture with domestic partners,” stated Citigroup.
The institution added, referring to details that had been aired about a draft bill for legalisation: “In light of the lower [Thailand] gaming tax rate at 17 percent and the lower operating expenses – mostly wages and utilities – versus Singapore, we believe EBITDA margin could reach 40 percent to 50 percent, which implies Thailand could see industry EBITDA of approximately US$4.1 billion” annually.
In terms of Thailand’s timetable, Citigroup stated: “We anticipate the Thai government to complete the entire process as quickly and as efficiently as the Singaporean government two decades ago.”
Singapore opened its first casino complex – Resorts World Sentosa – in early 2010, just under five years after an April 2005 prime ministerial statement on a proposal to develop “integrated resorts” as a stimulus for inbound tourism and the local economy.
The Citigroup analysts said regarding Thailand: “The Thai government has shown its determination in creating a major booster to the tourism industry via the gaming legalisation, and the speedy legalisation process thus far is a testament to that.”
They added: “We expect the remaining legalisation process and the subsequent request-for-proposals to remain centralised at the national government level.”
A number of casino brands has shown interest in investing in Thailand, including Macau-based operators.
The current draft bill proposes casino licences running for 30 years, with the possibility of renewal for a further 10 years. Each casino resort would require at least THB100 billion (US$2.88 billion currently) in investment, according to the document.
