The timing of a return of tourist travel to Macau and casino revenue approaching late-2019 levels was a matter of “speculation,” heard on Monday a panel at the inaugural edition of ICE Asia, a casino industry conference and exhibition.
The comment was made by Vitaly Umansky, an analyst at brokerage Sanford C. Bernstein Ltd.
But when he and another expert commentator – Kevin Clayton, a consultant and former chief marketing officer for Macau casino licensee Galaxy Entertainment Group Ltd – were asked which Asia-Pacific (APAC) market might recover the fastest, there was clarity: Macau.
Macau (pictured) could probably get to a point “fairly close to full recovery”, based on “pent up demand and the requirements of the Chinese” consumer, without the foreign tourism component, said Mr Clayton.
“Macau will be quickest… partially because it’s dependent on one market,” namely China, said Mr Umansky. He acknowledged however that opinion among commentators varied regarding the degree and timing of comeback, due to the large number of variables involved, particularly regarding the relaxation of travel restrictions in the region.
The question on regional favourites for recovery was posed by Alidad Tash of casino consultancy 2NT8 Ltd. Mr Tash is a former senior Macau gaming executive who has worked for Melco Resorts and Entertainment Ltd.
Mr Umansky said China was likely to be where travel would “open up first” in the return to business after the initial shock of Covid-19.
Such customers “will have the ability to start coming” to Macau “at some point,” he added.
Mr Clayton suggested that, in the absence of well-heeled Chinese being able to travel further afield for a while, the international standard of facilities at Macau’s modern casino resorts would give the city pulling power.
In terms of other regional casino markets, many of them were “hybrid markets, between locals and destination international visitors,” stated Mr Umansky. “Macau does not have as much of that international visitor composition,” he observed.
Australia had “reopened” casinos in places and had a “pretty strong local market,” stated Mr Umansky, adding however that he thought “the international market there is going to be really, really soft.”
“With the emerging markets around Asia: Cambodia, Vietnam… these are all going to take much, much longer,” said the Sanford Bernstein analyst.
Separately his brokerage stated in a Tuesday note that Singapore’s casino gross gaming revenue (GGR) was likely to have a “slow recovery”, getting back to 2019 levels “only in 2023”.
“We expect GGR to decline 59 percent in Singapore during 2020, and then see a 90 percent rebound in 2021,” wrote Mr Umansky and his colleagues Eunice Lee and Kelsey Zhu.
The institution said the local market was likely to “come back faster” once the city-state’s casinos reopen. “There remains considerable uncertainty around travel restriction loosening in Singapore (and the feeder markets) and the economic impact from Covid[-19] on feeder markets, in particular Malaysia and Indonesia,” it added.
