GGRAsia – NagaWorld 2024 GGR to rise 26pct, China play helping: CICC

NagaWorld 2024 GGR to rise 26pct, China play helping: CICC

Jan 31, 2024 Newsdesk Latest News, Rest of Asia, Top of the deck

The NagaWorld casino complex in Cambodia is likely to record a 26-percent year-on-year increase in gross gaming revenue (GGR) for full-year 2024. The estimate is by China International Capital Corporation (CICC) Hong Kong Securities Ltd.

The brokerage said in a note last week that the GGR forecast for NagaWorld (pictured in a file photo) was linked to “potential overseas gaming demand”, particularly from Chinese tourists.

The NagaWorld casino complex is run by Hong Kong-listed NagaCorp Ltd. The firm has a long-life monopoly casino licence for the Cambodian capital, Phnom Penh.

Analysts Goh Shengyong, Wang Jiayu and Hou Liwei said that, despite the expected GGR increase for 2024, the tally was still expected to represent under half the overall GGR figure for 2019, a period prior to the onset of the Covid-19 pandemic.

The CICC team said it expected mass GGR at NagaWorld to recover in 2024 to 92 percent of the 2019 level, “driven by continued pick up” and inflow of Chinese tourists, as well as by an improved mix of customers in terms of people on business trips. Such individuals were likely to have “higher spending power” than other catergories of client, and stay for longer at NagaWorld.

The brokerage added that VIP GGR could recover in 2024 to 37 percent of the 2019 level, potentially helped by a revival of the regional junket industry and “higher ASEAN intra-region spending power”. That was a reference to the Association of Southeast Asian Nations, a political and economic group of 10 states in Southeast Asia.

CICC mentioned in its note a correlation between foreign direct investment from China into Cambodia and GGR levels at NagaWorld.

NagaCorp reported earnings before interest, taxation, depreciation and amortisation (EBITDA) of US$215.4 million for the first nine months of 2023. The figure was up 17.4 percent from the prior-year period. GGR from casino operations amounted to US$379.0 million, a 12.1-percent increase from a year earlier.