• Subscribe
  • Magazines
  • About
  • Contact
  • Advertise
Sunday 27 July 2025
  • zh-hant 中文
  • ja 日本語
  • en English
IAG
Advertisement
  • Newsfeed
  • Mag Articles
  • Video
  • Opinion
  • Tags
  • Regional
    • Africa
    • Australia
    • Cambodia
    • China
    • CNMI
    • Europe
    • Hong Kong
    • India
    • Japan
    • Laos
    • Latin America
    • Malaysia
    • Macau
    • Nepal
    • New Zealand
    • North America
    • North Korea
    • Philippines
    • Russia
    • Singapore
    • South Korea
    • Sri Lanka
    • Thailand
    • UAE
    • Vietnam
  • Events
  • Contributors
  • SUBSCRIBE FREE
  • 中文
No Result
View All Result
IAG
  • Newsfeed
  • Mag Articles
  • Video
  • Opinion
  • Tags
  • Regional
    • Africa
    • Australia
    • Cambodia
    • China
    • CNMI
    • Europe
    • Hong Kong
    • India
    • Japan
    • Laos
    • Latin America
    • Malaysia
    • Macau
    • Nepal
    • New Zealand
    • North America
    • North Korea
    • Philippines
    • Russia
    • Singapore
    • South Korea
    • Sri Lanka
    • Thailand
    • UAE
    • Vietnam
  • Events
  • Contributors
  • SUBSCRIBE FREE
  • 中文
No Result
View All Result
IAG
No Result
View All Result

Analysts turn cold on Macau gaming stocks with material GGR improvement no longer expected in 2022

Ben Blaschke by Ben Blaschke
Mon 11 Jul 2022 at 12:05
Starr Xian: Human Factor
28
SHARES
691
VIEWS
Print Friendly, PDF & Email

Industry analysts have warned against accumulating Macau casino stocks after once again revising down their estimates for the months ahead due to the ongoing outbreak of COVID-19.

In a Monday note, Credit Suisse analysts Kenneth Fong, Lok Kan Chan and Sardonna Fong suggest “accumulating the sector only when there are more solid signs of a sustainable GGR recovery.” This follows the government’s decision over the weekend to order the closure of all commercial and industrial businesses, including casinos, for seven days from midnight at the start of 11 July to midnight at the start of 18 July.

It is just the second time that Macau’s casinos have been ordered shut – the previous occasion coming in February 2022 when casinos closed for 15 days, also because of COVID.

With no clear pathway towards reopening and China sticking with its zero-COVID policy, the Credit Suisse analysts said the current situation implies that Macau GGR will likely stay depressed for the rest of this year.

“We expect any meaningful improvement (if it materializes) is likely to come only in 1Q23 next year,” they said.

On the call to avoid accumulating stocks, the analysts note that this could see investors miss the first 10-20% of a rally but, with a gaming cycle rally normally lasting for 1.5 years on average, “could still [allow investors to] ride on the upcycle with higher certainty.”

They also outline their reasons for taking a more negative short-term view on Macau, stating, “Given the highly contagious nature of Omicron and with the number of cases remaining at an elevated level despite mass testing, the timing of a complete clearance is yet to be sure.

“Given that the border may only reopen after 14 days of zero domestic cases (that could potentially drag into mid-August), the pace of GGR ramping up may also be slow as players’ confidence may have been impaired and could take time to rebuild. The players may choose not to return in the near term, fearing that they may not be able to return to their hometown if additional new cases are discovered.”

In a separate note, JP Morgan’s DS Kim and Livy Lyu said both July and August were almost certain to be write-offs and also warn that they would need to revisit their liquidity models for Macau’s operators based on a zero-revenue environment.

“Our analysis suggests SJM and Sands have the shortest liquidity runway of nine months until March 2023, while other operators such as Wynn/MGM/Melco have 1.5 to 2 years of liquidity with Galaxy being an outlier with 5 years of liquidity,” they write.

However, with license rebidding imminent and operators now required to set aside MOP$5 billion (US$625 million) in share capital throughout their concession period, the liquidity runway will be shortened even further, “to just one month for SJM and six months for Sands in this worst-case scenario (zero revenue, zero funding and a lock-up on MOP$5 billion), although other operators should still be okay.

“In practice, we expect controlling shareholders to provide funding via shareholder loans, similar to the case of Wynn last month.

“All-in, we are not too worried about the liquidity situation overall, perhaps except for SJM (which wouldn’t have much headroom even after a shareholder loan).”

RelatedPosts

MGTO says no apparent impact on visitor numbers from limitation on provision of free snacks in Macau casinos

Macau visitor arrivals rise 13.3% year-on-year to 2,891,003 in June

Fri 25 Jul 2025 at 05:45
IAG to launch weekly “The IAG Live Streaming Show” starting this Friday 25 July

IAG to launch weekly “The IAG Live Streaming Show” starting this Friday 25 July

Thu 24 Jul 2025 at 14:20
A New Macau

Sands China to adopt more aggressive approach to customer reinvestment in Macau due to recent underperformance, targets US$2.7 billion annual EBITDA

Thu 24 Jul 2025 at 06:16
Dr Wilfred Wong

The Londoner Macao shows benefits of multi-billion-dollar revamp as 2Q25 performance pushes Sands China revenues to US$1.79 billion

Thu 24 Jul 2025 at 05:17
Load More
Tags: casinoscovid-19Credit Suissegaming stocksMacauSands ChinasharesSJM Holdings
Share11Share2
Ben Blaschke

Ben Blaschke

A former sports journalist in Sydney, Australia, Ben has been Managing Editor of Inside Asian Gaming since early 2016. He played a leading role in developing and launching IAG Breakfast Briefing in April 2017 and oversees as well as being a key contributor to all of IAG’s editorial pursuits.

Current Issue

Editorial – An inconvenient truth

Editorial – An inconvenient truth

by Ben Blaschke
Fri 27 Jun 2025 at 15:21

It’s understandable that political observers, academics and members of the public in greenfield jurisdictions would express caution around the legalization...

Light & Wonder’s Siobhan Lane

Light & Wonder’s Siobhan Lane

by Ben Blaschke
Fri 27 Jun 2025 at 15:19

Siobhan Lane, Light & Wonder’s highly experienced CEO of Gaming, speaks to Inside Asian Gaming about the company’s ongoing transformation...

Honesty is the best policy

Honesty is the best policy

by Ben Blaschke
Fri 27 Jun 2025 at 14:13

The Thailand Entertainment Complex Roundtable brought industry stakeholders, politicians and supporters of the government’s Entertainment Complex Bill face to face...

Sri Lanka’s casino industry

Sri Lanka’s casino industry

by Shaun McCamley
Fri 27 Jun 2025 at 13:36

Industry veteran Shaun McCamley delves into the complex history of Sri Lanka’s casino industry at a time when the country...

Evolution Asia
Your browser does not support HTML5 video.
Aristocrat
GLI
Nustar
SABA
Mindslot
Solaire
Hann
Tecnet
NWR
Jumbo
568Win

Related Posts

Winds of change

Belle Corp’s share in City of Dreams Manila gaming revenue down 18% in 1H25

by Newsdesk
Sat 26 Jul 2025 at 08:39

Philippines real estate firm Belle Corp saw its share in gaming revenue from City of Dreams Manila fall by 18% year-on-year to Php772.3 million (US$13.5 million) in the first half of 2025, reflecting the challenges currently being faced by Manila’s...

DigiPlus to enter South Africa’s online sports betting market

DigiPlus to enter South Africa’s online sports betting market

by Newsdesk
Sat 26 Jul 2025 at 08:37

Philippines gaming technology firm DigiPlus Interactive Corp has announced plans to further expand internationally by entering the South African online sports betting market. The company said in a Friday statement that it would file license applications with the Western Cape...

Uncertain future for POGO industry suppliers as PAGCOR says operations in “status quo” for now

Maybank: Threat of total ban on Philippines online gaming is real, more clarity from President Marcos likely Monday

by Ben Blaschke
Fri 25 Jul 2025 at 12:34

Malaysian investment bank Maybank has warned that the threat of a total ban on the Philippines’ domestic online gaming, or eGames, sector is real given that political noise is similar to before recent bans on eSabong and POGOs. While Maybank...

MGTO says no apparent impact on visitor numbers from limitation on provision of free snacks in Macau casinos

Macau visitor arrivals rise 13.3% year-on-year to 2,891,003 in June

by Pierce Chan
Fri 25 Jul 2025 at 05:45

According to data from Macau’s Statistics and Census Service (DSEC), a total of 2,891,003 visitors arrived in Macau in June, representing a year-on-year increase of 13.3%. Mainland China remained the primary source of visitors to Macau in June, with 1,995,627...

Your browser does not support the video tag.


IAG

© 2005-2024
Inside Asian Gaming.
All rights reserved.

  • SUBSCRIBE FREE
  • NEWSFEED
  • MAG ARTICLES
  • VIDEO
  • OPINION
  • TAGS
  • REGIONAL
  • EVENTS
  • CONSULTING
  • CONTRIBUTORS
  • MAGAZINES
  • ABOUT
  • CONTACT
  • ADVERTISE
  • 中文

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In

Add New Playlist

No Result
View All Result
  • 中文
  • Subscribe
  • Newsfeed
  • Mag Articles
  • Video
  • Opinion
  • Tags
  • Regional
  • Events
  • Contributors
  • Magazines
  • Advertise
  • Contact
  • About
  • Home for G2E Asia

© 2005-2024
Inside Asian Gaming.
All rights reserved.

  • 中文
  • English