GGRAsia – Citi cuts growth forecast for Macau’s mass market

Citi cuts growth forecast for Macau’s mass market

Aug 11, 2014 Newsdesk Latest News, Macau, Top of the deck

Citigroup has sharply reduced its growth forecast for Macau’s casino mass market. The brokerage cut its estimate to a growth rate of 13 percent in the second half of this year in year-on-year terms, from a prior forecast of 35 percent.

Citigroup said it continued bullish on the Macau casino industry in the long run, but added it was prudent to revise its forecast following the reported deceleration in mass-market revenue to a growth rate of 17 percent in July.

Analysts at the brokerage noted it was not yet clear what had led to the deceleration, nor if this was an inflection point.

Citigroup also revised downward its forecast for the performance of the city’s VIP industry. It now expects a decline of 13 percent for the second half of 2014 versus a prior estimate of a 5-percent drop.

The brokerage slashed its full-year casino gross gaming revenue (GGR) estimate for Macau from growth of 11 percent to just 4 percent.

Macau’s GGR for July fell by 3.6 percent year-on-year to MOP28.4 billion (US$3.56 billion), official data show. Macau’s accumulated total casino gaming revenue for the year to July 31 is MOP221.5 billion, a year-on-year growth of 10.2 percent.