Macau’s post-pandemic record of nearly MOP24.09 billion (US$3.01 billion) in casino gross gaming revenue (GGR) in October was “well above expectations”, rising 15.9 percent year-on-year, as high-end play outperformed market forecasts following the Golden Week holiday break, said Seaport Research Partners.
This year’s October Golden Week – a major festive break for mainland China consumers and a peak trading period for Macau’s casinos – ran from October 1 to 8.
“While Golden Week was softer than expected, strong demand in high-end play during the rest of the month drove October GGR growth well above expectations,” wrote Seaport’s senior analyst Vitaly Umansky in a Sunday memo.
“We believe the month benefited from high VIP hold – although some operators saw low hold – and was strongly driven by premium mass and VIP play,” he added.
Brokerage JP Morgan also said in a Sunday note that Macau’s October GGR was a “surprise beat”, being “the strongest GGR in six years” and “representing circa 125 percent/35 percent recovery in mass/VIP GGR versus pre-Covid”.
“Segment wise, high-end – VIP and premium mass – again led momentum, driving VIP up 40 percent to 45 percent, helped by strong VIP luck. and mass up 12 percent to 13 percent,” suggested analysts DS Kim, Selina Li and Lindsey Qian.
According to the JP Morgan analysts, October’s GGR tally “should dispel concerns that Macau’s rebound was just a summer blip or event-driven”.
They added: “Robust second half of October confirms demand weakness in late September/early October was typhoon driven and temporary, and that Macau’s upcycle – fuelled by positive wealth effect and liquidity … –remains intact.”
Analyst Steven Pizzella of Deutsche Bank Securities Inc observed that the October GGR result was a “31.7-percent sequential improvement … relative to September”.
“The 27.4-percent sequential increase per day was circa 1,130 basis points higher than historical trends, as the average sequential increase per day in October, relative to September, over the 2013 to 2019 period, was plus 16.2 percent,” added Mr Pizzella.
The brokerages expect Macau’s GGR to grow at least 8 percent year-on-year in November, with Seaport forecasting a 11.5-percent increase from November 2024.
In its Sunday memo, the JP Morgan team stated: “November faces tougher comparisons than October, with growth likely moderating to 8 percent to 10 percent. That said, easy comparisons kick in from December, where we expect plus 15 percent to 17 percent GGR growth.”
The October result took market wide GGR for the first 10 months of the year to nearly MOP205.43 billion, up 8.0 percent from a year earlier.
