Malaysia gaming demand likely despite Omicron: analyst

Feb 17, 2022 Newsdesk Latest News, Rest of Asia, Top of the deck  

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The business outlook in 2022 for Malaysia’s only casino complex, Resorts World Genting (pictured), might be brighter than Omicron-variant infection rates for Covid-19 in that nation might suggest, said a Wednesday note from Maybank Investment Bank Bhd.

It cited consumer-activity data from three other major casino markets – the United States, the United Kingdom, and Australia – regarding demand for a variety of services amid Omicron.

The Covid-19  variant appeared to have lower mortality rates than earlier variants of Covid-19, said Maybank.

Analyst Samuel Yin Shao Yang said the institution had looked at sources including Google’s Covid-19 Community Mobility Reports – specifically the data for retail and recreation activities. The data permit comparison between consumer interest in retail and recreation activities in pre-Covid-19 trading times and subsequently.

“To our positive surprise”, the three countries mentioned “were only negatively impacted in a minor way in December 2021 despite the surging number of Covid-19 cases caused by the Omicron variant,” wrote Mr Yin.

The financial institution mentioned that as of Monday (February 14), Malaysia had recorded 24,340 new Covid-19 cases, which Maybank said was “a six-month high”.

“With Malaysia going through another surge in new Covid-19 cases due to the Omicron variant, we ask ourselves whether the Malaysian gaming industry will go through another year of movement control orders, a euphemism for lockdowns, leading to another year of losses or reduced earnings,” wrote Mr Yin.

But he added it seemed unlikely that fresh lockdowns would be imposed amid Omicron in Malaysia, which has reported a high rate of vaccination against Covid-19.

“We posit that Malaysians are still inclined to participate in gaming despite the risk of being infected with Covid-19, as long as the risk of serious health complications is low,” said the analyst.

Earlier this month, Malaysia’s National Recovery Council proposed that from March 1, the country’s borders fully reopen to international travellers, and without mandatory quarantine.

Resorts World Genting – which this month opened its much-anticipated new outdoor theme park – had been a popular destination for foreign tourists prior to the Covid-19 pandemic, investment analysts have stated.

The property is the flagship asset of Genting Malaysia Bhd, which also has casino operations in  the United States, United Kingdom, Egypt, and the Bahamas.

For the entire third quarter last year, Resorts World Genting, outside Malaysia’s capital Kuala Lumpur, was shuttered as a Covid-19 countermeasure. After closing its doors temporarily on June 1, Resorts World Genting only reopened on September 30.

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