Sands China to be king of Macau’s castle; VIPs expect stability in 2013; No funny business in the junket market

casinos macauSands China is expected to outperform the wider Macau gambling industry in 2013. Fitch Ratings estimate that Macau as a whole will see a rise of 8 percent in gross gaming revenue in 2013, which will be push along in the most part by double digit growth in the mass market. Fitch expects Sands to exceed the market forecast thanks to its “sizeable capacity” and a new allocation of table games that will take their mass market tables beyond the 1,000 mark. Much of the growth will be driven by their recently opened Sands Cotai Central venue that is specifically targeted at growth in the mass market. Fitch added that a rule allowing Sands to move table allocation between mass and VIP business is “a luxury that most other operators do not have” and therefore gives them a leg up on their competitors. They will be able to utilize their vast amount of space to “heavily utilize electronic table games and slots, which is becoming a more meaningful segment in Macau and for which there are no unit restrictions”.

The VIP segment will remain stable next year with no dramatic dips in revenue expected. Those were the words of Francis Tam Pak Yuen, the enclave’s secretary for economy and finance, who told Macau Post Daily: “We expect that the VIP gaming business will enjoy stable development in the coming year.” It comes after a year of uncertainty for the VIP segment and continual reports that Mainland China is looking to clampdown on larger amounts of money being taken to Macau through fear of money laundering.

Boss of junket investor Neptune Group has given an absolute denial that junket operators have any involvement in illegal business. Nicholas Niglio told The Standard, a Hong Kong based periodical, the notion they are involved in anything illegal is “ridiculous”. This was before he added: “The promoters will not give up their credibility for such a small return from illegal activities.” As for the VIP sector as a whole, the industry is facing a period of “consolidation” according to Niglio, with small junkets swallowed up by mid-sized ones.