Macau July GGR forecast cut on lower hold: Bernstein

Monday 22nd of July 2019

Bernstein Research has lowered its forecast for Macau’s July gross gaming revenue, mainly due to an expected lower VIP hold.

The firm says that according to its channel checks GGR from July 14 to 21 was MOP17 billion ($2.1 billion), for an average daily rate of MOP809 million. The month-to-date ADR is up 2 percent from June and down 1 percent from July last year.

“VIP volume is estimated to be down mid-single digits m/m with the hold rate towards the lower end of the normalized range,” the firm said. “Mass GGR is estimated to be up mid-single digits % m/m.”

As a result, it has cut its estimate for GGR growth to flat to up 2 percent for July, down from up 6 to 8 percent previously.

However, the firm cautions that weekly channel checks have proven to be volatile in the past and “less than accurate.”

However, moving forward the year-on-year comparisons are likely to ease, as the beginning of U.S./China trade tensions last summer began to bite.

"One area of potential high end GGR stabilization and renewed strength may come from a recovering credit cycle in China which may support VIP recovery in 2H,” it said.

That said growth in China was weaker-than-expected in June and the ongoing trade war will pose headwinds for China’s economy and as a result on gaming spending in Macau from China’s high rollers.