[ET Net News Agency, 13 January 2021] Goldman Sachs noted that Macau's GGR continues to
recover gradually, with the YoY decline narrowing from -95%/-90% in August/September to
-66% in December, adding up to US$7.5bn in FY2020 (down 79%).
Daily visitation also picked up from 10k in September to 23-26k recently. Considering
that Hong Kong's shutdown has precluded about one-third of gamblers from visiting (i.e.,
historically 15% of Macau's GGR has come from HK players and another 15-20% from long-haul
travelers visiting HK/Macau on the same trips), its current GGR run-rate suggests slightly
over half of non-HK related gaming volume might have returned, led by the premium mass
segment (i.e., back to 45-50% of prior-year levels), followed by grind mass (~40%) then
VIP (20-25%), the research house said.
Goldman revised its industry forecasts and now assumed FY2021 GGR will be -28% below
2019 levels (versus -15% previously), with slower recovery in VIP (-40%) versus the
mass-market segment (-21%). For 2022, it expects industry GGR to fully recover back to
US$36bn, led by mass-market (+12% vs 2019 levels).
It revised its target prices for the casino operators it covers as follows:
Name Rating Target Price
----------------------------------------------------------
SJM Holdings (00880) Buy HK$12.10 from HK$11.90
MGM China (02282) Neutral HK$11.70 from HK$10.70
Wynn Macau (01128) Neutral HK$15.00 from HK$14.20
Galaxy Ent (00027) Buy HK$73.40 from HK$67.30
Sands China (01928) Buy HK$41.40 from HK$37.60
Melco Int'l (00200) Buy HK$19.20 from HK$18.40

(KL)