Operator News
China – Morgan Stanley tips Macau’s GGR to double by 2022
By Phil - 7 November 2017
Analyst Morgan Stanley Believes that GGR in Macau could double for many operators by 2022, reaching US$53bn if the renewal of gaming concessionaires goes smoothly.
Called ‘Macau 2022 – Power of Compounding,’ the report is based on a growth of six per cent in visitation and five per cent in spend per head.
Morgan Stanley said: “We think the quality of growth will be better, as more than 80 percent of the forecast profit should come from the mass market segment. Starting in 2018, we expect to see game-changer infrastructure developments with respect to HK-Zhuhai-Macao Bridge and Hengqin. We also think that by 2022, there will be clarity around license renewal, development capex and infrastructure ramp. However, our long-term valuation could come down if there is either a one-time payment or increase in tax for the license renewal.”
The research also predicts growth in 2018 and 2019 of 11 per cent and 12 per cent respectively.
SJM Holdings and MGM China are tipped to lead the growth as both have big openings on the horizon in Cotai. Morgan Stanley said there was a ‘high likelihood of doubling the profit and tripling the dividend,’ for these two operators.
