Japan casinos to generate $7b in GGR

Brokerage Nomura has projected a yearly GGR of US$7 billion for Japan’s casino industry once two major IRs are developed in Yohohama and Osaka.

Japan.- The casino industry in Japan is soon to get finally approved and companies from all over the world are ready to enter the local business. According to a report by brokerage Nomura, the industry will generate gross gaming revenue (GGR) of US$7 billion per year if it includes two major integrated resorts.

The report released on Friday, and quoted by GGRAsia, projects the billionaire revenue in case two major IRs are developed in Yokohama and Osaka: “Both of these cities are ideal locations for integrated resort development considering their: significant local population (about 9 million); sizeable inbound tourist flow (10 million to 18 million yearly); and strong infrastructure support,” said the brokerage.

Regarding earnings before interest, taxation, depreciation and amortisation (EBITDA), Nomura said that each of the two IRs would generate US$1.6 billion, which would make them “the most profitable casino resorts globally.”

“Currently, an entry levy of [US$73.5] per day or [US$1470] per year is imposed on the Singapore residents if they were to enter the casino. If the Japanese government were to impose an entry levy that is significantly higher than that, there is a risk that the mass GGR could come in significantly below our estimate as we expect vast majority of the mass revenues to be sourced from the locals,” Nomura explained.

Casino gambling has been made legal in December but the industry is expecting for the approval of the IR Implementation bill, which would detail the specifics, including how casinos will be monitored, administrated and regulated. According to Nomura, the bill could be passed in June 2018, “putting the resorts on track for opening in 2023.”