Gaming stocks generally up, easing of quarantine measures may benefit visitors to Macau during the “May 1st” Golden Week

In early trading today, the gaming sector of Hong Kong stocks rose collectively. As of press time, Futu Niu Niu gaming sector rose more than 4%, $Melco International Development (00200.HK)$ rose 7%, $Galaxy Entertainment (00027.HK)$ , $Wynn Macau (01128.HK) and Sands China Ltd (01928.HK) rose 4%, while MGM China (02282.HK) and SJM Holdings (00880.HK) rose 3%.

On the news, quarantine measures to go to Macau have been relaxed from today. The Macao SAR Government’s New Crown Virus Infection Response and Coordination Center announced on the 19th that, after consultation through the Zhuhai-Macao Joint Prevention and Control Mechanism, from 0:00 a.m. on the 20th, people entering from Guangdong Province via the Zhuhai-Macao port or waterway will be required to take 48 days after the sampling date. Nucleic acid test negative certificate within hours. According to the previous epidemic prevention measures, those entering Macao through the Zhuhai-Macao port must hold a negative nucleic acid test certificate within 24 hours after the sampling date.

According to the “Macao Daily”, when asked whether the relaxation of quarantine would be beneficial to tourists coming to Macau during the “May 1st” Golden Week, Macau SAR Tourism Director Senna Fernandes responded that the average number of tourists visiting Macau was about 1.8 per day during the Easter holiday just past. The “May Day” Golden Week in the Mainland will last for five days from April 30 to May 4. It hopes to attract about 20,000 visitors a day, that is, more than 100,000 visitors in five days.

In the previous Easter period, the performance of Macau’s tourism industry was not good. Lu Zhiliang, chairman of the Macau Hotel and Tourism Chamber of Commerce, said that the sales of “food, accommodation and tourism” in Macau were good, but the overall situation was poor. The Easter schedule is not good, and there are fewer customers than usual, especially the day after Easter, there are only 10,000 inbound tourists. The traditional hotels with the best occupancy rate are only nearly 40% of the guests.

Macau’s first-quarter gross gaming revenue falls 24.8% year-on-year

Previously, the Macau Bureau of Gaming Inspection announced that the gross revenue of games of chance in the first quarter of 2022 was 17.774 billion patacas (the same below), down 6.8% quarter-on-quarter and 24.8% year-on-year. VIP baccarat, which reflects VIP room revenue, recorded a revenue of 4.839 billion yuan in the first quarter, a decrease of 60 million yuan quarter-to-quarter. By the end of March, the total number of gaming tables was 6,025, a decrease of 173 from the end of last year; the number of slot machines was 11,615, a decrease of 143.

Citi: Downgrades Macau’s April gaming revenue forecast to 2.5 billion patacas

According to a report by Citi, according to industry data, Macau’s gaming revenue on the first 18 days of April was about 1.6 billion patacas (the same below), which means that the average daily revenue in the past week was about 75 million patacas, which was about 100 million patacas lower than the 100 million patacas on the first 10 days of this month. 25%, mainly reflecting the outbreak of the epidemic in the Mainland. Among them, the transaction volume of VIP rooms decreased by about 25% month-on-month, while the transaction volume of mass market decreased by about 30% month-on-month.

The bank lowered its April gaming revenue forecast to 2.5 billion yuan from 4.5 billion yuan, and if the forecast comes true, it will be the lowest monthly gaming revenue since September 2020.

CICC: MGM and Wynn Macau operating efficiency may be better than peers

In terms of sectors, based on the historical profitability of gaming tables and slot machines of each gaming operator from 2010 to 2019, CICC concluded that MGM China and Wynn Macau may outperform their peers in terms of operating efficiency, mainly benefiting from The recovery of business led by the high-end mass market will improve the yield.

Looking ahead, the bank expects Wynn Macau and MGM China to maintain their industry-leading positions, and SJM’s operating efficiency may still be lower than its peers.

According to CICC, in terms of the operating efficiency of Macau gaming tables, the order is (from high to low): MGM China, Wynn Macau, Melco, Sands China, Galaxy Entertainment, and SJM Holdings.


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