According to a research report released by Zhongtai Securities, it is optimistic that gaming companies' performance will improve significantly in 2024. With the gradual improvement of the above factors, it is expected that the degree of recovery in inbound traffic to Macao will continue to pick up.
The Zhitong Finance app learned that Zhongtai Securities released a research report stating that it is optimistic that gaming companies' performance will improve significantly in 2024. With the gradual improvement of the above factors, it is expected that the degree of recovery in inbound traffic to Macao will continue to pick up. The bank believes that the performance expectations of Macau gaming companies will improve markedly in 2024. It continues to focus on Sands China (01928), which accounts for the fewest share of the intermediary VIP room business and has an obvious advantage in the number of gaming tables and guest rooms.
The main views of Zhongtai Securities are as follows:
Macau's gross gaming revenue in November was MOP 16.04 billion. The degree of recovery declined month-on-month after the holiday period to 70% of the same period in 2019, in line with the company's expectations.
The gross revenue of Lucky Gaming declined after the holidays in November, in line with the company's expectations. According to data from the Macau Gaming Supervision and Coordination Bureau, the gross revenue of Macau Lucky Gaming reached MOP 16.04 billion in November, an increase of 435% over the previous year. After the peak season, gross gaming revenue in November fell 18% month-on-month. Judging from the degree of recovery, Lucky Gaming's gross revenue in November recovered to 70% of the same period in 2019, and the degree of recovery fell 3.6 percentage points month-on-month. In January-November, Macau Lucky Gaming's gross revenue totaled MOP 164.49 billion, recovering to 61% of the same period in 2019.
The flow of inbound visitors to Macau in October recovered to 86% of the same period in 2019. According to data from the Macao Statistics and Census Service, the number of inbound visitors to Macau reached 2.76 million in October, an increase of 375% over the previous year and an increase of 20% over the previous month. In terms of the degree of recovery, inbound passenger flow in October recovered to 86% in the same period in 2019, an increase of 2.7 percentage points over the same period in 2019. In January-October, the number of inbound visitors to Macau reached 22.69 million, recovering to 68% of the same period in 2019.
The number of group tours and flights is still gradually being resumed. In terms of group tours, the number of visitors entering the group reached 170,000 in October, an increase of 28% over the previous month. There were 961 mainland flights to Australia in October, returning to 75% of the same period in 2019 (1,233 flights), an increase of 5.6 percentage points over the same period in 2019.
Risk warning: Gaming industry policy risks, mainland macroeconomic downturn, and passenger flow recovery falls short of expectations.