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China – Bernstein says Hong Kong protests aren’t a problem for Macau

By - 25 September 2019

Brokerage firm Sanford C Bernstein does not believe the protests in Hong Kong are having a negative impact on Macau’s casino revenues, claiming instead ‘the protests in Hong Kong may help tourism to Macau.’

It highlighted that most VIP players fly to Macau direct with players going through Hong Kong usually from the mass gaming segment.

Analysts Vitaly Umansky, Eunice Lee and Kelsey Zhu said whilst Hong Kong’s problems may have ’caused some transport disruption and created headwinds to visitation into Hong Kong (and onward visitation into Macau), we believe the impact from the Hong Kong protests has been minor.’

“Although visitors from Hong Kong (as defined by travel documents used when entering Macau) make up on average 17 per cent to 19 per cent based on our conversations with casino operators and junkets, Hong Kong residents make up less than 10 per cent of mass GGR. The bulk of mass GGR and almost all VIP GGR is driven by Chinese players.”

“The Chinese authorities have created more limitations to visit Hong Kong as a result of the protests and in China sentiment against visiting Hong Kong has been on the rise. However, Macau remains disciplined, with no protests and with a pro-China sentiment clearly evident. These factors may help support Macau visitation. While high end has softened, and lower end visitation growth remains solid, average spend per room has declined and with a shortage of rooms, growth under such a scenario becomes more constrained.”

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