Macau Gaming Revenue Tipped to Double by 2017 - Online ...

May 15, 2013

Macau could nearly double its annual gaming revenues in just four years, according to a new report by Nomura Equity Research. In 2012, Macau gaming revenues hit a record MOP 304b (US $38b), but Nomura says strong consumer demand and the fact that Beijing officials are allowing more Chinese cities to opt into the Individual Visa Scheme could push that revenue total to MOP 560b ($70b) by 2017.

Using the growth of the Las Vegas gaming market between 1990 and 2005 as a template, the report concludes that Macau?s ?undersupplied? market will continue strong growth for years to come. Macau?s 3% annual limit on additional gaming tables will ensure that the ?positive spread between demand and supply is wide.?

Nomura estimates that Macau currently offers 57,187 ?gaming positions? at which gamblers can find a seat, which, when compared with the populations of Hong Kong and urban Guangdong ? areas from which most Macau gamblers arrive ? produces a ratio of 1,891 people per seat. (The US ratio is 227:1.) Considering that figure doesn?t even attempt to factor in the mass of would-be gamblers from the rest of China, and the sky appears to be Macau?s limit.

With its casinos firing on all cylinders, there?s little enthusiasm among casino licensees to add online gambling options to their arsenal, with one possible exception. Former Sands China general counsel Lu?s Mesquita de Melo noted that the latest administrative regulation governing slot machines included a new section devoted to the operation of mobile devices within the casinos. De Melo told Macau Business Daily that change ?only makes sense if you?re looking at opening up a sports betting market.?

Sports betting in Macau is something of an afterthought, officially taking in just $52.3m in non-horserace betting revenue in 2012. (Nevada sportsbooks earned $170m in 2012.) While there appears to be comparatively little interest in placing wagers, De Melo says there is ?considerable investor interest? in offering sports betting in Macau. Problem is, sports betting is the exclusive domain of Sociedade de Lotarias e Apostas M?tuas de Macau Lda (aka Macau Slot), whose contract was renewed last summer for a further three years. It may have to wait until the expiration of that deal in 2015, but whenever Macau?s regulators decide to conduct their first online gambling experiment, De Melo believes sports betting will be their guinea pig.

Source: http://calvinayre.com/2013/05/15/casino/macau-gaming-revenue-to-double-by-2017/

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