GGR to continue growing in Macau

Several brokerages forecast that casino GGR in Macau will continue to expand during the second quarter of 2018.

Macau.- The second quarter of the year will most likely see Macau casino gross gaming revenue (GGR) expanding by above-consensus levels, several brokerages forecast. Originally, it was expected to see a 15 per cent improvement but analysts expect to see an over 20 per cent growth according to recent checks.

“Customers are coming back with a better understanding of the post-corruption crackdown environment,” Fitch Ratings Inc analysts Alex Bumazhny, Colin Mansfield and Joseph Fontana said. The brokerage also said that the VIP gambling segment in Macau “continues to benefit from solid demand characteristics and a more healthy junket environment”.

“We are now forecasting second-quarter 2018 GGR to grow 22 percent, or 200 basis points higher than our previous estimate. This includes a May forecast of +18.7 percent and June of +20.0 percent,” Union Gaming analyst Grant Govertsen added.

According to JP Morgan Securities Asia, Macau GGR will grow between 15 to 18 per cent in May and 17 to 19 per cent in June. “GGR can grow 20 percent to 21 percent year-on-year in the second quarter,” analysts DS Kim and Sean Zhuang wrote.

Deutsche Bank Securities Inc analysts Carlo Santarelli and Danny Valoy also highlighted GGR’s expansion, which reached 28 per cent according to a Tuesday memo, which amounted to a total of 890 bps above its 18.7 per cent pre-month forecast. “On account of the upside to our April forecast, our second quarter 2018 GGR forecast goes to +21.5 per cent from +15.3 per cent, while our 2018 forecast goes to +14.9 per cent from +12.4 percent,” they said.