Chinese New Year set to boost Macau’s revenues
Investors are becoming more positive about Macau following a two-year slump in the world's biggest gambling hub. Operators are predicting to see a revenue boost soon, as Macau’s as hotel rooms fill up for Chinese New Year on 27 Jan.
Following Chinese President Xi Jinping’s crackdown on corruption, VIP punters are beginning to return, causing a 10% rise in betting in Macau last quarter to MOP 60.4bn ($7.6 billion). The Chinese New Year is set to add to this dramatic boost for operators, who are attempting to reinvent their casinos by offering more family-friendly resorts and attractions to draw recreational spenders and casual gamblers.
According to a Morgan Stanley survey, between 27 January and February Wynn Resorts Ltd.’s Palace casino, featuring a fountain show synchronized to music, as well as those at the Wynn Macau, Banyan Tree, StarWorld and the Ritz-Carlton had at 80-90% of their standard hotel rooms booked. Wynn Macau posted a 96 percent occupancy rate in the fourth quarter of 2016.
Furthermore, Deutsche Bank AG reported that six of Sands China Ltd.’s seven hotels were fully booked for at least three of the days during the Chinese New Year period.
Expectations of fierce competition around this peak period has led to a 20% rise in room rates at the Venetian, Sands Macao and Sheraton for this Chinese New Year compared to last year, according to the Morgan Stanley survey.
DS Kim, a Hong Kong-based analyst at JPMorgan Chase & Co., tells Bloomberg that booking trends for celebratory holidays and hotels are looking positive, and might be on track to surpass the Golden Week holiday in October 2016: “We stay bullish on the sector for genuine upturns in demand, profits and cash flows in 2017 and onward”.
Grant Govertsen, a Macau-based Union Gaming Group analyst, also tells the media company: “We’re looking for strong hotel bookings with rooms filled with more high-value customers than we’ve seen in recent history, which should lead to very strong Chinese New Year gross gaming revenue. Casino operators are bullish about their VIP and premium mass market businesses for the upcoming holiday period.”
Macau’s Gaming revenue recovery continued into December, following four previous months of growth. This revenue boost is expected to rise 8.5% this month from a year ago, according to the median estimate of eight analysts surveyed by Bloomberg.
Gambling Insider delivers the latest industry news, in-depth features, and operator reviews that you can trust. Our team combines rigorous editorial standards with decades of specialized expertise to ensure accuracy and fairness. We are committed to delivering clear, impartial, and dependable coverage across the global gambling sector.
