Macau doubts build on govt’s pledged review: Wells Fargo
An upcoming spring review of the casino industry by the Macau government “creates added uncertainty” in the Macau market said a note on Tuesday from Wells Fargo Securities LLC.
The institution on Tuesday cut its estimates on Macau’s total 2015 gaming revenue from 4 percent decline year-on-year to a 15 percent decline from 2014, citing concerns over continuing restrictions on use of transit visas by Chinese visitors, stricter currency regulations, and the mainland’s anti-corruption campaign.
On Monday, Karen Tang of Deutsche Bank AG in Hong Kong cut her 2015 growth forecast for Macau gross gaming revenue (GGR) from 0 percent to a decline of 8 percent year-on-year, citing tougher rules on junkets and transit visas as likely to continue to “hurt” VIP and mass-market gambling in the first half of 2015.
Cameron McKnight of Wells Fargo and his colleagues Rich Cummings and Tiffany Lee said in their Tuesday note: “We are not being bearish for the sake of it, but currently don’t see a reason to expect revenue improvement given China’s policy actions towards Macau.”
On January 2, Macau’s Gaming Inspection and Coordination Bureau announced a 2.6 percent decline year-on-year in the city’s casino GGR during 2014, following a 30 percent decline year-on-year in December.
On December 19, Macau’s Chief Executive, Fernando Chui Sai On said his government would in the spring “undertake a review” of the city’s casino industry. No detail on what form the review might take was given in local media reports.
It followed remarks made on a visit to the city by China’s President Xi Jinping. He called for Macau to show “greater courage and wisdom” to “strengthen and improve regulation and supervision over the gaming industry”.
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