Alvin Chau
There may be new competition for Macau’s VIP gamblers, according to a Reuters report which says that top VIP-gaming company Suncity Group might be interested in filing for their own licensing and casinos, instead of operating VIP rooms in local concessionaires as they currently do.
According to the report, big junket operators such as Suncity have been taking advantage of tighter regulations to beat competition from smaller companies and gain momentum.
In the last five years, the number of junkets has more than halved. The surviving junkets have become stronger leading to the potential operation of Suncity Group’s own casinos.
Suncity’s Alvin Chau has been investing in this field with his publicly traded Suncity Group Holdings, namely in Vietnam’s Hoiana development, which suggests that it could soon be a new competitor to Macau’s gaming giants.
It is also said that China’s poor growth prospects, which have reportedly been slowing down, have contributed to such an outcome.
Either way, if confirmed, this could take a significant proportion of high rollers from operators such as Wynn Macau, Galaxy Entertainment.
The Vietnamese development is only seen as a little threat at the moment, as Hoiana Integrated Resort will only have 1,000 hotel rooms and 140 gaming tables, making it a very small-sized property by Macau standards.
In any case, casino groups (including Melco Resorts & Entertainment, MGM China, Sands China and SJM) depend less on high rollers now than they did in the past. But China’s softening economic performance, aggravated by trade tensions, already presents some economic risks for Macau.
The pressure on markets may be even clearer, as operators prepare to release second quarter results this week. Melco Resorts & Entertainment (the first to report) says revenue fell by around 5 percent when compared to the year before.
As for Suncity’s Vietnamese ventures, Chau may hold more cards up his sleeve and try to start something bigger. He could try for a license in Macau should a new concession come up soon and if officials prefer a local outfit.
Obviously this will may be part of the conjecture and more about possibilities than facts, but stranger things have happened – recalling that the Lui family started in construction before founding the Galaxy gaming empire. It is safe to say that Macau’s casino moguls will keeping a close eye on Chau. RM
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