Mass market crucial for Macau Casino Industry’s recovery: Bernstein Analysts

Mass market crucial for Macau Casino Industry’s recovery: Bernstein Analysts

World-renowned gambling hub Macau’s hopes to restore its ailing casino industry depends more on the return of mass market gamblers than so-called high rollers, analysts from research firm Bernstein highlighted in their latest report.

According to the newly-released report, the return of ordinary gaming enthusiasts is more important than VIP gamblers for the revival of the Macau casino operators who are still reeling under the impact of the COVID-19 pandemic, which forced governments across the world to issue shutdown orders for all non-essential businesses, including gaming properties, in a bid to curb the spread of the deadly infection.

The analysts stated that Macau casino operators’ future gross gaming revenue growth in the special administrative region (SAR) would be sourced more from ordinary gamblers rather than high rollers. The analysts also predicted that it would likely take until at least 2023 before Macau casinos’ collective gross gaming revenue (GGR) tops 2019 levels.

Available stats also confirm that ordinary or mass market casino visitors are becoming more and more important in terms of Macau casinos’ GGR. In 2011, mass market gamblers used to represent nearly 27 per cent of the special administrative region’s annual GGR. But, mass market gamblers contributed more than high rollers earlier this year, before the outbreak of the pandemic. The estimates underscore the meaning of reopening travel between Macau and various provinces of mainland China.

Maria Helena de Senna Fernandes, director of Macau Government Tourism Office (MGTO), said in a statement, “Currently, we are all waiting. I hope that Macau can convey confidence to all the different authorities in the mainland and that they consider resuming the issuance of visas.”

In Macau, which claims to be the world’s largest gambling hub, some casino operators like NASDAQ-listed Melco Resorts & Entertainment and Wynn Resorts, are more levered to high rollers. On the other hand, competing operators like NYSE-listed Galaxy Entertainment and Las Vegas Sands are relying more on ordinary or mass market gamers.

Current laws allow travelers from across mainland China to visit Macau, but returning home remains an issue due to non-issuance of IVS. Beijing is yet to allow IVS permits for individuals and groups. Moreover, an uptick in the positive cases of corona virus in regions like Hong Kong has once again raised health concerns. In the two-week period ending on 27th of July, a total of 1,163 new cases of the deadly infection were recorded in Hong Kong.