CLSA, a number one brokerage agency, has up to date its forecasts for Macau’s gross gaming income (GGR) for 2024, now projecting a 1.6 % enhance. The revised estimate means that GGR will attain MOP$239.9 billion ($29.8 billion) this 12 months, fueled by heightened visitation and optimistic assumptions relating to GGR per customer.
Drivers of development:
This upward adjustment extends to the 2025 forecast, with a 3.2 % enhance anticipated. This development is attributed to bigger playing budgets and an uptick in visitation, pushed by the latest enlargement of eligible cities below the Particular person Visitation Scheme (IVS).
Analysts at CLSA underscore important year-on-year development anticipated for Macau’s GGR. They anticipate a sturdy 31.1 % enhance to MOP$239.9 billion ($29.8 billion) in 2024, adopted by a strong 6.4 % rise to MOP$255.2 billion ($31.7 billion) in 2025.
Along with revising GGR forecasts, CLSA additionally raises its outlook for the gaming sector’s EBITDA. They anticipate EBITDA to achieve $9.7 billion in 2025, marking a promising 2 % enhance from 2019 ranges.
CLSA highlights sustained gaming demand and supportive insurance policies as key drivers behind the projected enhance in visitation. Regardless of remaining 22 % beneath Might 2019 ranges, Macau’s GGR in Might reached a new post-COVID excessive, signaling a promising trajectory for the trade.
Continued desire for premium section:
The attract of Macau for premium gamers stays sturdy, as outlined in CLSA’s funding memo. Analysts Jeffrey Kiang and Leo Pan anticipate continued development, notably within the grind and base mass segments, pushed by an anticipated mixture inhabitants enhance of 45 million, representing a considerable 14 % rise from 2019 visitation ranges.
Whereas the general outlook is constructive, CLSA cautions about intense competitors amongst concessionaires, as Asia Gaming Transient stories. Evaluation reveals a notable 10 % quarter-on-quarter enhance in mixture rebates and reinvestment in gamers in 1Q24, outpacing corresponding GGR development, underscoring the significance of such investments in driving enterprise.
In its evaluation of Macau gaming concessionaires, CLSA predicts that Galaxy will achieve market share, increasing from 17.4 % in 1Q24 to 18.9 % in 4Q26. Conversely, MGM China is predicted to expertise a decline, with its market share dropping from 17.2 % in 1Q24 to fifteen.1 % in 4Q24, earlier than stabilizing thereafter.
Contemplating these forecasts and market dynamics, traders within the gaming sector ought to intently monitor the evolving panorama in Macau. Alternatives for strategic investments and partnerships might come up because the market continues to develop and adapt to altering client preferences and regulatory environments.
CLSA’s revised forecasts for Macau’s gaming income paint a promising image of development, pushed by elevated visitation and playing budgets. The agency’s evaluation additionally sheds mild on the aggressive panorama and the evolving dynamics of market share amongst concessionaires, offering beneficial insights for stakeholders within the trade.
