Visitation numbers to Macau have picked up since China eased its zero-Covid policy on Jan. 8, although Chinese New Year’s (CNY) visitor numbers will be “the true litmus test of how robust demand could be,” Morgan Stanley analysts Praveen Choudhary and Gareth Leung said in a research report yesterday.
Last weekend, 160,000 people entered Macau, flooding downtown, the old Taipa village and shopping centers. Casino floors also started to resemble pre-pandemic days, but the numbers are still shy of optimal levels, analysts say.
According to Morgan Stanley’s on-the-ground checks, ease of travel between Hong Kong and Macau is similar to pre-Covid levels, and “foot traffic in most casinos were about 35%-45% compared with 2018-2019.”
Yet, the bank raised its January gross gaming revenue estimates to MOP250 million a day from its previous estimates of MOP200 million a day.
However, something seems to be missing: Morgan Stanley warns that without a recovery in premium mass segment, “the sector’s growth trajectory could be slower than what the market expects.”
In the broader tourism and hospitality sector, businesses are showing optimism and anticipate a better than expected performance during the CNY, due to the sudden surge of China tourists in Hong Kong and Macau.
Trip.com group has seen mainland Chinese demand for travel continue to surge in the run-up to the Lunar New Year holiday season.
On the group’s leading Chinese language travel service platform Ctrip, between December 26, 2022 and January 5, searches for outbound flights from China increased by 83% compared to the preceding two-week period, with outbound flight bookings increasing by 59% over the same period.
Bookings show the most popular cross-border destinations include, by order of magnitude, Macau Hong Kong, Taiwan, Thailand, Australia, Singapore, U.S., Malaysia, United Kingdom, and Indonesia.
Analysis of Ctrip data shows overseas travel for the seven-day CNY holiday surged by 540% compared to last year’s Spring Festival; and the average cost of bookings is said to have risen by 32% year-on-year.
Ctrip data also shows airline bookings from China to Hong Kong increased by 18 times compared with the previous year, following the announcement easing restrictions.
The number of airline bookings to Hong Kong has also increased by 36% month-on-month. Similarly, the search popularity of Hong Kong on the platform was more than double that and increased by 85% month-on-month.
Internally, the top ten most popular domestic destinations for the Spring festival are Shanghai, Beijing, Sanya, Guangzhou, Chengdu, Shenzhen, Kunming, Hangzhou, Chongqing and Haikou, according to Ctrip.