08-11-2017

Macau’s casino revenue in October climbed to the highest in three years as many high-stake bettors and recreational players visited Macau after the Golden Week holiday. Gross gaming receipts rose 22.1 percent to $3.3 billion US dollars last month, according to the latest data released by Macau’s Gaming Inspection and Coordination Bureau. We remain our positive stance to the Macau gaming sector, in light of the continued solid recovery momentum, underpinned by the rising stablised macro climate in China and Hong Kong. Further, as increasing casino projects are being completed, it helps to ease off the operators’ capex pressure. Moreover, as more new casinos come on stream, growth of customer flow is likely to fare better. All these is set to strengthen both gaming and non-gaming revenue growth outlook in the upcoming peak season and 2018. That said, as the sector valuation is not cheap (trading at FY18E EV/EBITDA of 15-18x for most players), we are more selective to the stock picking. The market will favour more to the players with new casinos in the pipeline and with the operation concentrating in the Cotai area.

General Disclosure and Disclaimer:
Frontier Capital Management Limited (“FCM”) is a subsidiary of Frontier Financial Group (“the Group”). It is regulated and licensed by Hong Kong Securities and Futures Commission, also is an Exchange Participant of The Stock Exchange of Hong Kong Limited, and a Direct Clearing Participant of Hong Kong Securities Clearing Company Limited.
The information contained in this website is for informational purposes, and does not intend to recommend, invite, offer, or confirm of any terms. Based on the sources that are believed to be reliable, FCM attempts to provide accurate, complete, and up-to-date information and analysis. However, FCM cannot represent or guarantee its accuracy, completeness, or timeliness of such source and information. Before making any decision on your investment, you should weigh the provided information carefully and bear any responsibility and risk incurred. And you should seek for advice of a professional financial advisor.
The Group, its subsidiaries and connected persons may have held some of the equity securities mentioned in this article, but the Group and FCM will place your financial interests ahead of their own.