All that glitters is gold for Macao
Updated: 2015-10-06 08:34
By Emma Dai in Hong Kong(HK Edition)
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Asia's gaming hub Macao has beaten Hong Kong in tourism growth over the first four days of the ongoing National Day holidays, with casino stocks listed in Hong Kong continuing their strong rebound on Monday despite record low gambling revenue.
Since the start of the Golden Week on Oct 1, Macao had received a total of 540,922 mainland visitors during the first four days - an year-on-year increase of 7.8 percent - according to the Macau Government Tourist Office.
For the same period, the aggregate number of visitor arrivals reached 632,008 - up 1.9 percent compared with a year ago.
On Oct 2 alone, the volume of mainland visitors entering Macao peaked at 152,850 - soaring 24.3 percent over 2014.
For Hong Kong, the number of mainland visitors climbed by just 3.78 percent to 688,596 during the first four days of the week-long holiday break, according to the Immigration Department.
At the same time, the total number of visitors to Hong Kong fell by 4.85 percent on year to 1,656,687.
The busiest day at Hong Kong's border checkpoints was on Oct 2, when 443,640 visitors arrived, 18.44 percent less than a year ago. They included 202,703 tourists from the Chinese mainland - a rise of 22.34 percent increase from a year ago.
But, it has been a quiet Golden Week for Hong Kong retailers, with less shoppers reported to have visited Canton Road in Tsim Tsa Tsui - one of the city's prime and favorite shopping spots. Some retailers complained that their revenues have tumbled by 20 to 30 percent.
Lam Chi-ting, vice-chief administrative executive of the Hong Kong Federation of Trade Unions' Tourism Committee, said many of the tourists are believed to be only on transit through Hong Kong. "I don't think there'll be any rebound in local tourism until yearend even if the 'Golden Week' was not good."
Latest data from the Census and Statistics Department point to a contraction for the local retail industry. It said the total value of retail sales declined by 5.4 percent in August, while revenue from the sale of jewelry and watches, which rely heavily on tourist consumption, plunged 8.8 percent and that of apparels was down 13.5 percent.
On the stock market, despite the continued fall in gaming revenue, Macao casino stocks listed in Hong Kong continued with their rally on Monday on the back of robust tourist arrival numbers in Macao.
Leading the sector, Galaxy Entertainment Group saw its share price surge by 5.07 percent to close at HK$22.8. The casino operator, which launched the second phase of its Galaxy Macau entertainment resort on the Cotai Strip earlier this year, has gained 15.74 percent in the last two trading days.
Sands China's stock bounced 3.43 percent to HK$25.6 on Monday, extending its increase to 10.11 percent since Oct 2.
According to the Macao SAR's Gaming Inspection and Coordination Bureau, the gaming sector's monthly gross revenue fell by 33 percent on year to 17.13 billion Macao patacas ($2.15 billion) in September - the lowest monthly revenue recorded so far this year and 8 percent less than that for August.
In the first three quarters of this year, Macao casinos' accumulated gross revenue had plummeted by 36.2 percent on year to 176.02 billion patacas.
In a report published last month, Fitch Ratings said that despite concerns over the recent recession in Macao's gaming industry, the sector's fundamentals for "higher-margin, lower-volatility mass business remain intact". While forecasting a revenue fall between 33 and 34 percent this year, the rating agency expects Macao casinos to be "largely stable" in 2016.
"The gaming industry is the most obvious and direct beneficiary of Chinese (mainland) outbound travel. A good 70 percent of its revenue in Asia is driven by Chinese (mainland) gamblers," Fitch said, adding that the compound average growth rate of Asian casinos is expected to reach 7 percent in the next five years, driven by new capacity in Macao and other gaming centers in the region.
"Chinese (mainland) players will contribute $61 billion out of $84 billion in gross gaming revenue by 2019," the report said.
emmadai@chinadailyhk.com
(HK Edition 10/06/2015 page5)