GGRAsia – Travel restrictions a Macau August GGR drag: Bernstein

Travel restrictions a Macau August GGR drag: Bernstein

Aug 02, 2021 Newsdesk Latest News, Macau, Top of the deck

Macau’s casino gross gaming revenue (GGR) in August is likely to be negatively affected “as new Covid-19 cases [are] spreading across China,” says brokerage Sanford C. Bernstein Ltd. August’s tally might still be up in the “low-teens” month-on-month, said the institution in a Sunday note.

Macau casino GGR rose by 29.2 percent sequentially in July, to about MOP8.44 billion (US$1.06 billion), according to data issued on Sunday by the city’s casino regulator, the Gaming Inspection and Coordination Bureau, a body also known as DICJ.

“July’s month-on-month GGR improvement has been driven by visitation recovery following the June travel disruption in Guangdong caused by a previous Covid[-19] outbreak,” wrote analysts Vitaly Umansky, Louis Li and Kelsey Zhu.

Macau introduced tighter countermeasures to prevent the spread of Covid-19, coinciding with the fresh cases in neighbouring Guangdong province, the largest-single feeder market currently for Macau’s tourists. The measures were gradually eased between the second half of June and early July.

But travel restrictions between Macau and mainland China have again been increased since late July, due to new Covid-19 infections on the mainland.

With effect from the stroke of midnight on Saturday (July 31), people intending to enter Macau on a direct flight from mainland China must hold a nucleic acid test certificate issued within the preceding 48 hours, proving they are ‘negative’ for Covid-19 infection.

As of Monday (August 2), the Macau authorities have also added new locations – spread across eight Chinese provinces – to the list of places where departing travellers must do a 14-day quarantine on arrival in Macau.

“As the Covid-19 cases are still spreading across China, and Macau-Hong Kong travel is not likely to reopen soon, we forecast August GGR to be down 60 percent compared to August 2019 (up low-teens percentage month-on-month from July 2021,” stated Sanford Bernstein in its Sunday memo.

It added: “We except GGR improvement beginning in late summer as Covid-related travel constraints begin to fall away.”

The brokerage currently estimates Macau GGR in 2021 to increase by 144 percent year-on-year, still down about 50 percent from 2019, i.e., pre-pandemic levels.