Average daily casino gross gaming revenue (GGR) in Macau was flat for the first 11 days of August when judged year-on-year, said a note on Tuesday by Hong Kong-based analysts at Credit Suisse AG.
The bank estimated GGR for the first 11 days of the month at MOP10.9 billion (approximately US$1.4 billion), a number gleaned from unofficial industry returns. That implies an average daily revenue (ADR) of MOP990 million, it added.
It thinks if the daily revenue trend continues for the month in a range of MOP950 million to MOP1 billion per day, it could result in a year-on-year contraction in Macau gaming revenue of between -3 percent and -1 percent.
But Credit Suisse adds: “Channel checks suggested mass-market momentum is improving with +20 percent year-on-year growth while VIP rolling chips volume remained largely steady month-on-month.”
The bank said of Macau gaming shares: “In our view, the recent correction has largely priced in the moderating mass-market growth trend already and we see limited downside from here.”
According to a filing with Nasdaq on July 31, T. Rowe Price, a U.S.-based global investment firm regarded as one of the most knowledgeable institutional investors in the gaming industry, increased its shareholding in Wynn Resorts Ltd, the U.S.-based parent firm of Wynn Macau Ltd, to 11.3 percent from approximately 7 percent previously. Several analysts suggested to GGRAsia that showed continued faith in the Macau story but a change of emphasis in capital allocation, given that the U.S. parents’ ownership of the Hong Kong-listed gaming entities is somewhat diluted.
Union Gaming Research Ltd said in a note on Tuesday: “Last week, shares of Macau casino operators sold off sharply on the news that July’s mass market growth slowed to a rate of ‘only’ 17 percent. Importantly, we don’t think a single casino operator has ever expected mass market to continue to grow north of 30 percent into the back-half of 2014 suggesting a wide discrepancy between sell-side consensus and the industry.”
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