Staff reporter and agencies
Macau casino stocks jumped as the world's biggest gaming hub posted an 82.5 percent rise in gambling revenue last month, beating expectations, thanks to the tourist surge after China's reopening.
Gambling revenue in January reached 11.6 billion patacas (HK$11.3 billion), data from Macau's Gaming Inspection and Coordination Bureau showed yesterday, the first growth since February last year.
The figure also beat the median estimate of a 36.5 percent increase, according to analysts surveyed by Bloomberg.
Morgan Stanley earlier estimated Macau's January gaming revenue to come in at 6.2 billion patacas, while Bank of America provided a forecast of just 5 billion patacas.
But January's revenue was still less than half of the Lunar New Year period in 2019 prior to the Covid outbreak, official data showed.
Still, investors cheered the news, sending shares of Macau casino operators up in Hong Kong, with Galaxy Entertainment (0027) jumping 3.7 percent, Sands China (1928) up 2.2 percent and Melco International Development (0200) surging 4.9 percent.
China's Covid reopening on January 8, just ahead of Lunar New Year celebrations in the latter part of the month, sparked a surge in travel. About 451,000 visitors arrived in Macau during the week-long holiday, an almost 300 percent increase from a year earlier, with most arrivals coming from mainland China, according to provisional data.
While the Lunar New Year travel spike is a short-term boon for the sector, it's uncertain whether the sharp pace of gaming revenue growth will be sustained for the rest of the year.
Macau's casinos face increasing scrutiny from the government as part of Beijing's push for the city to shift away from its reliance on gambling, as well as a broader crackdown on the once-dominant VIP gambling sector.
While daily gaming revenue is back to around 60 percent of pre-Covid levels during the peak holiday season, Credit Suisse analysts including Kenneth Fong warned about the sustainability of the recovery's pace.
Macau is likely attracting more visitors due to its lack of Covid testing requirement versus Hong Kong and a dearth of international flight capacity in the mainland that is limiting travel options for now, while pent-up demand from Hong Kong residents may wane over time.
This came as WeChat Pay HK said the number of Hong Kong residents who used its services in Macau during the Lunar New Year holiday skyrocketed 19 times from a year ago, with a tenfold rise in transaction values.
Macau visitor numbers rose nearly 300 percent over the holidays. REUTERS
