CASINO

India needs more casinos for ‘vastly underserved’ local market, report says

TAGs: daman, Global Market Advisors, Goa, India, Jasmine Solana, Sikkim

The Indian gaming market is far from reaching its potential, industry experts said.

India needs more casinos for ‘vastly underserved’ local market, report saysAccording to the Global Market Advisors LLC (GMA), casino gambling in the country could potentially reach US$10.2 billion annually by the year 2025, thanks to the growing number of middle class residents with a healthy appetite for the casinos. However, the country don’t have enough gaming establishments that will cater to this “vastly underserved” market.

India’s current population stands between 1.25 and 1.30 billion, but its casino offerings combined with Nepal and Sri Lanka only amounts to 730 tables and far fewer slots. This means that each table game serves an estimated 1.7 to 1.6 million people.

“It is important to note that [our] gaming revenue [estimate]… would be generated by 20.3 million middle/upper class adults, which accounts for only 1.4 percent of India’s projected total population in that year [2025],” said GMA’s director of research and analysis Kit Szybala in a paper.

By 2025, 18 percent of India’s urban residents are forecast to gamble 10 times a year with an average gaming spend of US$55, while 9 percent of rural residents are expected to gamble six times a year with an average spend of US$70.

“Utilizing these conservative assumptions, the gaming market would generate nearly US$10.2 billion in gaming revenue in that year, with approximately US$7.0 billion in gaming revenue stemming from the urban population and US$3.2 billion in gaming revenue stemming from the rural population,” the paper concluded.

Last year, India was listed among Macau’s top 10 visitor source markets, but the analyst said international casino operators, many of whom were still “transfixed” by the lure of Chinese gamblers, have overlooked India as another potential source of demand.

“The existing gaming markets in and near India generally offer an unattractive gaming product that could be easily and vastly improved. Other gaming destinations fail to adequately market or cater to the Indian gamer. Even so, Indians continue to demonstrate a proclivity for gambling, as many Indians frequent legal casinos domestically and seek out gaming opportunities abroad,” Szybala said.

Goa, Daman and Sikkim are the only three areas in India that allow live casinos to operate within its borders. Sikkim, a small state located in northwest India, launched two casinos in 2009, and brought in a surge in tourism with an estimated 12,000 tourists visiting the state annually. A new casino in Sikkim is expected to open in the next two or three months. The gaming establishment will be operated by Indian conglomerate Delta Corp, which already operates several casinos in Goa.

“Indian gaming operators like Delta Corp and Pride Group, and non-Indian gaming operators like Silver Heritage already realize the potential value of the Indian gaming market. As such, they are currently positioning themselves to capitalize on the underserved market’s potential promise,” GMA said.

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