Citigroup Projects 5% Growth in Macau’s October GGR to $2.56B

In a promising prediction, Citigroup has projected that Macau’s Gross Gaming Revenue (GGR) for October 2024 is set to reach MOP20.5 billion (approximately $2.56 billion), marking a 5% increase compared to the previous year. This optimistic forecast comes ahead of the October Golden Week, a significant event for the gaming industry, noted for its high levels of tourism and gaming activity.

Analyst George Choi attributes the anticipated growth to robust demand and strong advanced hotel bookings from affluent visitors. According to Citigroup’s report, the daily GGR for the remainder of October is expected to average around MOP592 million ($74 million). Although this number indicates a softening of about 34% compared to the heightened activity usually seen during the Golden Week, expectations remain high for the National Day Golden Week. During this period, GGR is forecasted to average MOP900 million ($112 million) per day, mirroring run rates observed over recent Chinese New Year and Labor Day holidays.

Despite this positive outlook, Citigroup has slightly revised its mass GGR forecasts, noting a potential decline in the grind mass sector. Recent surveys suggest a decrease in average Baccarat minimum bets, a first since the reopening, signaling possible weaknesses which Citigroup advises approaching conservatively. Consequently, a 3% to 5% reduction in GGR forecasts is suggested for the fourth quarter of 2024 through 2026. However, Choi remains optimistic that this weakness will dissipate by mid-2025 as newly announced policy combinations in Mainland China boost disposable income among the population.

Nevertheless, Citigroup maintains a bullish stance on Macau’s market due to the steady demand from Premium Mass players. Data from Citigroup’s proprietary table survey confirm that affluent players continue to spend significantly in Macau. Advanced hotel bookings by these players play a crucial role, with accommodations booked around 14 days earlier than previous years—compared to only 7 days for this year’s Chinese New Year.

Though retail sales in Macau have shown signs of weakness, Citigroup believes this will be a short-lived trend. The firm expects Chinese government policies to soon provide a boost to disposable incomes, thereby invigorating discretionary spending in the region. This renewed economic activity will likely bolster Macau’s standing as a premier destination for gaming and leisure activities.