Daiwa Securities Group Inc revised downward its growth projection for Macau’s gaming industry in 2014. The Japanese brokerage firm reduced its full-year casino gross gaming growth forecast to 16 percent from 18 percent, based on softer VIP growth.
Daiwa now expects VIP casino gross gaming revenue to increase by 8 percent in 2014, from a previous estimate of 13 percent. But the brokerage revised upward its projection for the mass-market segment by 2 percentage points, to 34 percent.
In its latest report on Macau, released last week, Daiwa Securities forecast the VIP credit environment to be tight in the coming months, with junket operators more cautious when extending credit to high rollers. The brokerage warned this can translate into near-term volatility for shares of gaming operators with Macau exposure.
The brokerage said it expects the full ban on smoking in the mass market – to start on October 6 – and the reported introduction of restrictions to the use of China UnionPay swipe card devices inside casinos to have a minimal impact on the mass segment’s fundamentals in the medium term.
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”The Philippines has been the primary growth driver, but really the broader Asian gaming industry is something that’s really important to us”
Chief executive of casino equipment provider Light & Wonder