According to the research report released by JPMorgan, the adjusted total gambling revenue (GGR) of the first 10 days of June in Macau was 6.5 billion yuan per day, totaling 65 billion yuan (MOP equivalent), which is equal to the daily revenue in May. This level is better than the normal season, which covers two weekends and the Dragon Boat Festival holiday. It is believed that the gambling revenue data this month will be strong, maintaining the forecast of 18 billion yuan in June gambling revenue. The company's top picks are MGM China (02282) and Wynn Macau (01128), followed by Sands China (01928), Galaxy Entertainment (00027), SJM Holdings (00880) and Melco Int'l Dev (00200).
The bank estimates that mid-field casino revenue has recovered to 115% of pre-pandemic levels, while VIP revenue is around 25%, both slightly higher than in the first quarter and similar to the trend in the second quarter. Although the valuation of Macau casino stocks is not high, despite unexpectedly strong demand recovery and a seemingly favorable policy background, the bank still has a constructive view on the sector, believing that there are no strong short-term catalytic factors to drive re-rating, and that the market is currently more concerned about long-term upward space and special opportunities for revenue correction.