Morgan Stanley has lowered its estimates for Macau’s overall casino gross gaming revenue (GGR) in 2025, saying it now expects GGR to grow by 4.8 percent year-on-year, to about MOP238.35 billion (US$29.78 billion). The forecast is down about 4.0 percent from a prior estimate, said the institution in a Tuesday note.
The investment bank’s estimate for combined 2025 earnings before interest, taxation, depreciation and amortisation (EBITDA) for the city’s casino operators is now 7.2-percent lower compared to its prior forecast, at US$7.99 billion. That would be a 5.7-percent improvement year-on-year, it stated.
Macau “GGR and EBITDA could grow by mid-single digits in 2025,” wrote analysts Praveen Choudhary, Gareth Leung, and Stephen Grambling.
“We are below sell-side consensus as we are more conservative on margins. We expect weak December GGR to be followed by a stronger first-quarter 2025,” they added.
The analysts said they maintained their mass GGR assumption “at 118 percent of the 2019 level” but cautioned that “increased reinvestment costs for most companies result in a 7-percent lower industry 2025 EBITDA forecast”.
They added: “We are 6-percent below sell-side consensus as we mark to buy-side consensus, which is lower, in our view.”
The banking institution said it expects Sands China Ltd, Galaxy Entertainment Group Ltd and SJM Holdings Ltd to be “gainers” in terms of mass-market GGR share in 2025.
The other three operators – MGM China Holdings Ltd, Wynn Macau Ltd, and Melco Resorts & Entertainment Ltd – would see their mass-market share erode slightly next year.
The Macau government has forecast MOP240 billion for 2025 casino GGR, a figure that the city’s current Chief Executive, Ho Iat Seng, said was “definitely achievable” and a “conservative estimate”.
In late November, the city’s Secretary for Economy and Finance, Lei Wai Nong, said Macau’s 2025 visitor tally could reach 36 million, or a circa 9-percent gain on this year’s projected 33 million.
