Macau: Morgan Stanley estimates Feb GGR at USD 1.39 B, citing gaming and hotel recovery

Macau gaming remains strong post Chinese New Year, with casino traffic and minimum bets staying high, even though the SAR typically becomes quiet after Lunar New Year holidays, Morgan Stanley analysts Praveen K Choudhary and Gareth Leung noted in a recent report.

China air capacity to Macau recovered to 70 per cent of pre-Covid levels in February, an encouraging sign in terms of the premium mass market as most higher-end customers travel by air, the investment bank underlined.

Also, the average hotel occupancy rates and daily room rates remain robust after the CNY holiday, based on a hotel survey conducted by the two analysts.

Hotel occupancy rates have appeared to be even stronger than the pre-pandemic levels, with 9 out of 25 surveyed hotels fully booked from 18 to 24 February.

Current average daily room rates are doing even better than the May Golden Week 2021, the best holiday since Covid, and most of the hotels registered much stronger room rates compared with the figure reported in 2019.

The gross gaming revenue for the first week of February was tracking at MOP 376 million per day, an increase of 36 per cent year-on-year, 31 per cent higher than the January daily gross gaming revenue.

As Chinese package tours resumed from 6 February, Morgan Stanley analysts expected February’s gross gaming revenue at MOP11.2 billion, representing 44 per cent of the figure recorded in the same period in 2019.

The brokerage said that if February’s gross gaming revenue turned out strong, the market could revise its 2024 estimates upwardly.