GGRAsia – SJM, Wynn Macau Ltd moving to MSCI small cap HK index

SJM, Wynn Macau Ltd moving to MSCI small cap HK index

Nov 17, 2021 Newsdesk Latest News, Macau, Top of the deck

Macau-based casino operators Wynn Macau Ltd and SJM Holdings Ltd will be moved to the MSCI Hong Kong Small Cap Index at the end of this month, MSCI Inc, the entity that compiles the index, has told GGRAsia.

MSCI had on November 11 announced that with effect from market close on November 30, the two gaming firms would be removed from the main MSCI Hong Kong Index.

It was part of MSCI Inc’s semi-annual review for its MSCI equity indices. The firm is one of the world’s largest providers of financial market indices.

MSCI told GGRAsia that Wynn Macau Ltd and SJM Holdings Ltd will be migrating from the standard size segment for large- and mid-caps into the small-cap size segment “due to their size”.

Wynn Macau Ltd’s stock price has fallen by 43.6 percent in the last six months, to HKD7.42 (US$0.95) at Hong Kong market close on Tuesday. SJM Holdings’ stock price fell by 27.1 percent in the same period, to HKD6.30 as of the end of Tuesday trading.

The current stock prices of the Macau-based casino operators make them the two smallest constituents – by market value – of the main MSCI Hong Kong Index.

Wynn Macau Ltd and SJM Holdings Ltd would become the two largest firms, measured by capitalisation, on the MSCI Hong Kong Small Cap Index.

The MSCI Hong Kong Small Cap Index “is designed to measure the performance of the small cap segment of the Hong Kong market,” according to MSCI Inc. It currently features 75 constituents and reportedly covers approximately 14 percent of the free float-adjusted market capitalisation of the Hong Kong equity universe.

Wynn Macau Ltd operates two casinos in Macau: Wynn Macau on the peninsula and Wynn Palace in the Cotai district. The firm said last week its net loss for the third quarter grew by 54 percent from the previous quarter to just under US$179.9 million.

SJM Holdings runs Casino Grand Lisboa and the Lisboa casino hotel on Macau peninsula and opened its HKD39-billion (US$5-billion) Grand Lisboa Palace casino resort on Cotai on July 30. The firm produced adjusted third-quarter EBITDA that was negative by HKD460 million (US$59 million), narrower than a year earlier.

The MSCI Hong Kong Index “is designed to measure the performance of the large and mid-cap segments of the Hong Kong market,” according to MSCI Inc. It currently features 37 constituents and reportedly covers approximately 85 percent of the free float-adjusted market capitalisation of the Hong Kong equity universe.

After the removal of Wynn Macau and SJM Holdings, three Macau-based gaming operators will remain on the index: Galaxy Entertainment Group Ltd, Sands China Ltd, and Melco Resorts and Entertainment Ltd.

Another local casino firm, MGM China Holdings Ltd, was removed from the index in November 2019.