Macau to capitalize on Thailand’s USD15b casino market

Macau is strategically positioning itself to capitalize on the potential opportunities arising from Thailand’s likely entry into the lucrative casino market, which is estimated to reach a substantial value of USD15.1 billion (MOP121.55 billion) in the near future.

Thailand, as projected by brokerage CLSA, is expected to inaugurate its first entertainment complex by 2029, potentially introducing a 17% gaming tax on gross gaming revenue (GGR).

CLSA analysts Jeffrey Kiang, Naphat Chantaraserekul, and Leo Pan have underscored the distinct disparities in tourism dynamics between Macau and Thailand, emphasizing the diverse visitor profiles, the varying lengths of stay, and tourists’ nationalities in each region.

These variations highlight the unique strengths and potential growth opportunities each destination offers within the broader context of the gaming and hospitality sectors.

“Even though mainland tourists are likely to be a major source of Thailand’s post-COVID tourism rebound, we see sharp differences between Macau and Thailand tourism, with these ensuring Macanese gaming resilience,” said the analysts.

The analysts also drew attention to the contrasting profiles of visitors to Macau and Thailand, with Macau predominantly attracting visitors from Hong Kong and the mainland, while Thailand remains an untapped market for those from the mainland and India.

According to CSLA, the low travel penetration rates in Thailand present a significant growth potential, especially if the rates increase to levels comparable to those observed in Macau. This could result in a substantial surge in annual visits from the mainland and India.

In terms of market considerations, visitors to Thailand and Macau stay for different amounts of time and are of varying demographics.

While both destinations welcomed around 40 million visitors in 2019, Thailand’s visitor base is more international, with a significant proportion arriving from countries beyond China and Hong Kong.

Moreover, tourists tend to stay longer in Thailand, averaging over a week, in contrast to the shorter stays observed in Macau.

“Visitors also stay in Thailand for over a week on average, compared with less than two nights in Macau,” the analysts wrote. From 2005 to 2019, the average length of stay in Thailand was 9.3 days, with Asian visitors staying between 5.5 and 9.9 days.

Recently, the brokerage reported that four of Macau’s six gaming operators are interested in investing in Thailand

The report suggested the annual gross gaming revenue (GGR) value of the Thai casino industry could be as high as USD30.8 billion, with a base projection of USD15.1 billion.

Among the Macau gaming concessionaires, Galaxy Entertainment Group Ltd, Las Vegas Sands Corp, MGM Resorts International, and Wynn Resorts Ltd are believed to be considering investments in the country.

The proposed gaming licenses would be valid for 20 years, with a 17% tax rate, targeting foreign visitors as the primary clientele.