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Markets have been pricing in a slowdown in Macau gambling. Earlier earlier this year we wrote that some expected 14 per cent revenue growth in 2012.But so far gaming revenues have stayed strong. In fact, Citi analyst Anil Daswani expects March gross gaming revenue (GGR) to rise 25 per cent year-over-year to 25 billion Macanese pataca (MOP). From the Citi report:
“Based on our channel checks, Macau table GGR through the first 25 days of March amounted to MOP19.2bn. The daily table GGR run rate during the period amounted to ~MOP800m/day versus MOP822m/day during Jan and Feb.”
Markets have been concerned about Macau’s gaming revenues because of the slowdown in China. The VIP segment in particular which is credit-induced and depends on wealth creation, the ability to spend/gamble, and the availability of credit.
But gaming revenue was up 42 per cent in 2011, and January-February 2012 combined revenues were up 28 per cent year-over-year. While March revenues are expected to be slightly lower than the first two months of they year, Daswani expects it to be just shy of the record monthly GGR in October last year.
Here’s a chart from Citi that shows the market share split:
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