Several casino industry sources and an investment analyst polled by GGRAsia say they expect Macau to see robust volumes of gamblers and general leisure tourists during mainland China’s five-day holiday starting on Labour Day, May 1.
“Mainland Chinese visitors are still willing to make trips and spend their money,” said Hoffman Ma Ho Man, deputy chairman of Hong Kong-listed Success Universe Group Ltd, an investor in the Ponte 16 casino resort in the city’s Inner Harbour district.
That was despite the fact “the economy in mainland China and Hong Kong is not doing so well,” he added.
A Tuesday note about the business impact of this year’s May holidays, from brokerage Morgan Stanley Asia Ltd, said gross gaming revenue (GGR) for the period, might be “73 to 77 percent of the 2019 level”; with the daily GGR figure this time, likely to be “5 to 10 percent below the 2024 Chinese New Year level”.
Jeffrey Kiang, an analyst at brokerage CLSA Ltd, based in Hong Kong, said in his comments to GGRAsia, that the institution did not see specific indicators suggesting gaming business performance for the upcoming May break would “meaningfully differ from previous Golden Weeks”. The latter term refers to peak demand periods during key mainland holiday seasons. That was “barring win rates” being unfavourable for the operators, he noted.
A supporting factor for the city, said Mr Kiang, was that “Macau has always targeted a niche group of visitors, which we argue is more immune to economic slowdown,” than other consumer segments.
A senior Macau gaming executive, who asked not to be identified, told GGRAsia a key challenge currently for the city’s casino operators was to attract – and most importantly, keep – “quality” clients. So-called premium mass gaming patrons – betting in high denominations with cash chips – were in particular, “sensitive to player rebates”, said the person.
The idea that such customers were currently shopping around for the best deal among Macau’s six casino concessionaires, had been mentioned previously by several industry bosses.
This particular executive remarked to GGRAsia in the latest commentary: “[Macau] operators these days are more worried about quality of the visitors and getting more of them, than simply soliciting a vast number tourists.”
Volume helps more than hinders
During pre-pandemic trading years, a number of investment analysts had mentioned that volume of tourists to Macau was not necessarily either a proxy for or a predictor of, GGR volume. Nonetheless, the three years of pandemic-related travel restrictions to Macau – leading to a much smaller volume of visitors – also coincided with a severe curtailment of GGR.
The “upward momentum” in Macau tourism seen during holiday periods since the ending in January 2023 of pandemic-related movement restrictions, was likely to continue during the May holidays, said Success Universe’s Mr Ma.
Occupancy rates at Ponte 16’s, Sofitel Macau hotel for the upcoming break, range from “80 percent to 90 percent”, across the five days, he stated. Ponte 16’s casino relies on the gaming licence of Macau casino concessionaire SJM Holdings Ltd.
CLSA’s Mr Kiang told GGRAsia: “Broadly speaking, the travel demand for May Golden Week looks solid to us, which means good foot traffic in Macau.”
He added: “Our empirical data of tracking hotel bookings suggests so far 17 out of 35 hotels we look at are fully booked for the upcoming Golden Week, versus 12 fully booked” in the week prior to Chinese New Year 2024.
The analyst noted: “Macau has always been prominent in gaming business, while its appeal in non-gaming events has grown since 2023.”
There were some “notable events” during the May holiday season “that could possibly drive visitations from leisure guests,” he observed.
Mr Kiang added: “These include but are not limited to, [the] Leon Lai Stage on 8 [residency] concert in Studio City, of which two days – May 1 and May 4 – coincide with the holiday.”
GGRAsia’s Tuesday snapshot survey on Labour Day-holidays demand – looking at official booking sites for luxury hotels in Macau casino resorts – indicated that 11 out of 32 local luxury hotel towers, most of them establishments at Cotai casino resorts, were indicating all five nights of the break as fully booked.
GGRAsia’s search focused on the standard room category with either a king bed or two beds, accommodating two adults.
