Macau Casino Business Will Continue to Improve

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Casinos in Macau at dusk

Macau has shifted from a VIP-focused promised land for casino-goers to a rather more laic place under the sun. The country has been enjoying a very tangible upswing in the number of its mass market users who have been more than happy to visit the many available casino properties.

The data has come from the Macau’s Gaming Inspection and Coordination Bureau (DICJ), with the information being quite significant as to the changes that have been taking places within the country. A cursory look at the numbers has revealed the slow-down in the VIP segment, with DICJ reporting that VIP GGR grew at 14.4%, i.e. the average rate.

Meanwhile, VIP Baccarat accounted for about 55.7% of all casinos in Macau in the second quarter of the financial 2018. A closer perusal of the facts revealed that Baccarat had indeed slowed down a bit, around 4%, between April and June the same year.

Modest inroads have been driven by a number of varied gambling products, including table games, land-based slots and video slots. Meanwhile, analysts have been examining the potential for growth in Macau. According to Union Gaming analyst Grant Govertsen, the market is well-poised to sport a steadfast growth that will continue a double-digit-increase in July.

A Look at Macau Up Close by JP Morgan

Union Gaming has not been alone in divining a bright future for Macau’s casinos. JP Morgan, a renowned financial firm, has been quite optimistic despite a slow-down in the second quarter. Overall, JP Morgan has been satisfied, advising its investors not to shed assets just yet, as the casino sector is most likely headed for new highs.

Despite the drop in VIP revenue, from 14% a year before to 7% in Q2 in 2018, the market is shifting from its former exclusivity to a more approachable version of itself, which will feature budget players and average citizens.

Despite the slow-down, there are forecasts that estimate that the VIP segment will jump back to 9% before the year is out thanks to the Chinese economy.

The Fruit of Tourism

The Macau Tourism Office has reported a mild increase in the number of tourists visiting the country, although there has been no clear correlation between gambling revenue and how many people choose to visit Macau. Nevertheless, the potential increase in people visiting the country may signal better opportunities for local establishment to brand themselves internationally, however, subtly and without any immediate promise of a return.

Another noteworthy point to take into account is the fact that the industry stood steadfast despite rumors of looming trade war with the United States, which has beginning to shape up rather insidiously in the backdrop. That adversity alone has not been enough to put a dent in the casino industry.

If JP Morgan and Union Gaming’s prognosis hold true, we will be seeing a more significant take off in the revenue that Macau casino establishment generate in the third quarter of 2018. A return of the VIP gamers will also be very welcome.

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