Several investment analysts are forecasting year-on-year growth of between 12 percent and 16 percent in Macau’s March casino gross gaming revenue (GGR).
Brokerage Sanford C. Bernstein Ltd said that – based on unofficial industry returns for the month to March 26 inclusive – and against a background of strength in VIP play, it was lifting its own estimated range of GGR growth for full March by several percentage points, to 13 percent to 14 percent.
The institution’s analysts noted that judged month on month, the average daily rate (ADR) for Macau casino revenue was down, although such seasonal variations are not uncommon following earlier peak holiday periods such as Chinese New Year.
“Compared with February’s ADR of MOP821 million [US$102.6 million], the month-to-date ADR of MOP673 million was down 18 percent,” stated Bernstein analysts Vitaly Umansky, Zhen Gong and Yang Xie in a Monday note.
“VIP remained strong and luck factor during last week was at normal level according to our channel checks,” they added.
“According to checks and estimates, Macau GGR is trending between +12 percent and +16 percent,” said David Bain, an analyst at Aegis Capital Corp, in his Monday note on the March numbers.
“While this is in line with our +13 percent to +16 percent estimate range, it is above consensus [which was] calling for a ‘high single-digit’ year-on-year March Macau market gain,” he added.
Mr Bain said that a strengthening contribution to the market from rolling chip-based VIP play could increase volatility in monthly casino GGR.
“While market trends are better than consensus, we note the higher the VIP weighting, the more volatile the final [official] March gaming revenue result… will be,” he wrote, referring to casino hold performance for baccarat, the Chinese VIP gamblers’ game of choice in Macau.
The Aegis Capital analyst added: “VIP weighting equals higher bet size over short periods and win-rate also comes into play.”
Mr Bain further stated: “We also note that [unofficial] gaming revenue trend checks have become less reliable over recent months.”
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Direct taxes on gaming collected by the Macau government in full calendar year 2018