The ranks of Macau’s licensed casino junket operators underwent further contraction last year, but analysts believe the numbers will stabilize in 2018.
Figures released this week by Macau’s Gaming Inspection and Coordination Bureau (DICJ) show the number of licensed gaming promoters fell to 109 – 99 companies and 10 individuals – this month, a 13.5% decline from the 126 approved junkets in operation during January 2017.
The current figure is further removed from the 141 licensed junkets on the DICJ’s approved list in 2016 and a 57% reduction from the 253 promoters who were plying their trade in Macau in January 2013.
The fifth straight year of junket shrinkage is partly due to the DICJ imposing tighter financial benchmarks on the sector. Also, some smaller junkets threw in the towel during Macau’s two-year-plus gaming revenue decline that ended in August 2016, or allowed their operations to be acquired by larger, more stable junkets.
However, with the VIP gambling sector having reestablished itself as the engine of the Macau’s market’s overall growth last year, analysts believe 2018 may snap the five-year streak of shrinking junket numbers.
Kwok Chi Chung, president of Macau’s Association of Gaming and Entertainment Promoters, told GGRAsia that the junket sector was unlikely to undergo a “big change” this year. If there is further downward pressure, “it will not be to a great extent” due to the consolidation push having “largely stabilized.”
Andrew Lo Kai Bong, chief investment officer of the market-leading SunCity Group junket, echoed this view, saying Macau’s VIP sector “has already grown to such a large scale that it is not easy for any new startups to enter it.”
Macau’s government plans to amend its gaming laws this year to further increase junket oversight, reportedly including greater disclosure on shareholder structure and boosting minimum capital requirements.
