Macau gaming stocks were higher this week after Credit Suisse said that the mainland’s crackdown on online gambling was beneficial to local casino operators.
This came even as Goldman Sachs rebutted the connection, saying that less business for online casinos based in Southeast Asia would not necessarily translate into more business for the Macau SAR.
“We do not believe stopping proxy betting in the Philippines or Cambodia would necessarily result in gaming volume being repatriated back to Macau,” Goldman Sachs said in a note, as cited by GGRAsia.
“Some of these [Chinese] players who participate in proxy betting in the overseas markets may have difficulty securing visas to travel abroad – whether it is Macau [or elsewhere].”
The latest estimates tracking performance in July 2019 show that revenues are roughly in line with those of the same month last year. Still, the average daily rate of MOP821 million over the first two weeks of the month indicates a rise of about 3% compared to June.
Meanwhile, according to data released on Tuesday by the Gaming Inspection and Coordination Bureau, the VIP gaming segment continued its decline in the second quarter of 2019.
Gaming revenue from VIP baccarat declined 15.6% compared to the second quarter in 2018, while the mass segment, including slot machine earnings, climbed 18.6% over the same period. Mass market baccarat led the increase, with growth of 22.8%.
Baccarat is by far the most popular game of chance in Macau. Last year, VIP and mass baccarat accounted for about 88% of the city’s total revenue.
The second quarter recorded combined gaming revenues of MOP73.5 billion, with VIP baccarat accounting for MOP34.6 billion, or 47% of the total. Meanwhile, mass market baccarat accounted for MOP29.6 billion, or 40% of the total.
Some brokerages yesterday suggested that the quarterly figures were overstated due to the reclassification of some gaming tables.
The analysts said that prior to the full cessation of smoking at gaming tables by January 1, 2019, some mass market gaming areas had been classified as VIP. The analysts attribute the continued rise in the mass segment to the classification correction.
Gross gaming revenue in the first half of 2019 fell just short of MOP150 billion (USD18.6 billion), down 0.5% from the equivalent period in the previous year. The result came as June performed well above expectations, recording 5.9% growth in what is usually considered the weakest month of the year.