GGRAsia – Big players, tourists due for Golden Week say Macau experts

Big players, tourists due for Golden Week say Macau experts

Sep 22, 2023 Newsdesk Latest News, Macau, Top of the deck

As a GGRAsia snapshot survey of booking engines for hotels within Macau casino resorts indicates very little spare accommodation for the upcoming autumn Golden Week, a number of industry commentators say that could be a positive for casino gross gaming revenue (GGR).

One senior Macau gaming executive, who requested anonymity, told GGRAsia that while their company prioritised gambling customers when it came to hotel room allocation, there had still been “very encouraging” general bookings for autumn Golden Week.

Another industry figure willing to be quoted by name, told GGRAsia separately that holiday demand from general tourists was strong, as well as from gamblers.

Hoffman Ma Ho Man, deputy chairman of Success Universe Group Ltd, an investor in casino resort Ponte 16, located in the Macau Inner Harbour district, told GGRAsia: “Now that the [travel] visa issuance is made much more convenient for Hong Kong- and Macau-bound mainland Chinese visitors, who can do it with automated [application] process all over the country… we can expect good traffic of both leisure travellers and gamers” for the upcoming Golden Week.

Ponte 16’s casino is operated under the gaming licence of SJM Holdings Ltd.

Ponte 16’s five-star hotel, under the Sofitel brand, has already seen circa “50 percent” of its rooms booked for the October golden week period, Mr Ma said.

He was confident that the resort would be at or close to capacity for the actual holiday period starting on September 29, with room rates edging “close to 2019-level”.

New hotel products

Macau has seen the launch of several new high-end hotels starting summer. They include the Raffles at Galaxy Macau, which had a ‘soft’ opening to public on August 16.

Another Andaz Macau – also part of Galaxy Entertainment Group Ltd’s Galaxy Macau Phase 3. The latter hotel opened to the public on September 15.

Market rival Melco Resorts and Entertainment Ltd saw on September 8 the public launch of the W Macau hotel at the firm’s majority-owned Cotai property Studio City.

Jeffrey Kiang, an analyst at brokerage CLSA Ltd, said in response to an enquiry for GGRAsia regarding autumn Golden Week “…the MOP643-million [US$79.8-million] per day of GGR in 2023’s May [Labour Day] Golden Week could serve as a good starting point for previewing into the October one.”

He added: “Considering we are tracking circa 89 percent of [2019] visitation level now,” compared to “only 65 percent in May, there is a good chance the daily GGR per day in October Golden Week will exceed the aforesaid MOP643 million a day.”

Mr Kiang further noted: “On the patron profile, it appears to us that the premium mass will hold up well in this holiday period.”

“Given Macau operators typically have quite a high percentage [of] complimentary rooms… a high occupancy means the heavy presence of high[-spending] gamblers in Macau. Having said that, as visitation continues to ramp in Macau, the mass business will deliver a healthy performance in our view,” said Mr Kiang.

In a Wednesday memo, Morgan Stanley Asia Ltd said – citing its own hotel booking survey – that Macau’s casino hotels are likely to see occupancy tracking to a similar level as in the Labour Day holiday period in May this year, and close to the autumn Golden Week in 2019. “We think this is positive and shows that there is enough demand to absorb the increased hotel supply” in the Macau market, wrote Morgan Stanley’s analysts Praveen Choudhary and Gareth Leung.

As to the autumn Golden Week GGR estimates, the Morgan Stanley team wrote: “We believe buy-side consensus is around MOP800-million per day (70 percent of October golden week 2019’s level and 25 percent above the May golden week run rate). We think this level of GGR is achievable and implies VIP recovery of approximately 30 percent (24 percent in second quarter of 2023) with mass at 100 percent (as it was in July).”