Gaming | Fitch throws weight behind Macau’s revenue acceleration theory

THE gaming market of Macau will recover quicker than its main overseas rivals in Singapore and Las Vegas, according to a note by Fitch Ratings, echoing expectations from other analysts. The ratings agency said that this was because of Macau’s proximity to its main visitor source market.
Analysts told Macau Daily Times last month that although Las Vegas had shown early signs of recovery – fueled by demand from its domestic market – the recovery in the Macau SAR would soon overtake it. They indicated that this was because of improved health measures in the greater China region and pent-up demand from across the border.
In a note last week, Fitch said it was forecasting steep contractions in the gaming markets of the three regions in which gaming operator Las Vegas Sands operates, directly or via subsidiaries.
Fitch said that the market in Macau would contract by around 70% for the full-year of 2020, while Singapore and Las Vegas would fall by 65% and 60% respectively.
But Macau would recover faster because its “feeder markets” were more accessible than those of Singapore and Las Vegas, which had a “greater reliance on air travel.”
Last year, visitors from the greater China accounted for over 92% of tourist arrivals. Of those coming from mainland China, about half hailed from southern Guangdong Province and about 40% from the nine mainland cities of the Greater Bay Area.
As restrictions on China’s travel endorsement schemes ease this month and next, analysts expect a gradual recovery in the Macau market that will ultimately outpace that in Singapore and Las Vegas. DB