“Labour Day has been very strong and well above what the market had expected,” J.P. Morgan analyst DS Kim noted in an industry update today. The analyst said that the number of visitor arrivals in the SAR “has been quite strong already”, and that the quality of visitors should “remain better compared to pre-Covid days”.

A total of 491,968 tourists visited the SAR during the five-day Golden Week holiday, representing 77 per cent of the figure reported in the four-day Labour Day holiday in 2019.

J.P. Morgan estimated that mass demand had returned to over 90 per cent of pre-Covid levels during that period, much higher than the average 65 per cent recovery recorded in the first quarter.

Meanwhile, the report stressed that direct VIP had been a “dark horse”, with its recovery way beyond pre-Covid levels to hit 150 to 200 per cent for some operators.

The unexpected result should have translated to a 30 percent recovery in gross gaming revenue for the VIP segment in spite of a possible demise of junkets.

As a result, total gross gaming revenue could have recovered to about 65 to 70 percent for the Labor Day holiday, which was significantly higher than the 45 percent headline gross gaming revenue recovery reported in the first quarter.

Considering that the strong recovery in May took place despite a lack of transport and hotel accommodation, the investment bank pointed out that they “continue to see upside risks” to their printed forecasts to model “full recovery in mass demand” by next year.

The next peak season is expected to be the summer holiday between July and August, with the demand run rate estimated to “move up another notch”, the J.P. Morgan analyst said.

By Therese Tu