Macau officials project that the city’s gross gaming revenue (GGR) will hit MOP240 billion (£23.8 billion/€28.5 billion/$30 billion) by 2025, representing an 11% increase over their 2024 forecast of MOP216 billion.
However, Citigroup analysts believe that this estimate is too conservative. George Choi and Timothy Chau forecast that GGR will reach MOP245 billion, surpassing the government projection by 7%. This amount is approximately 83% of the total GGR in 2019, which was MOP292.46 billion.
The anticipated growth is attributed to a few key factors, including the increase of smart tables on casino floors and the government’s approval of new baccarat side bets.
Macau Business highlights that tourism will play a significant role, with nearly 36 million visitors expected, thanks in part to Beijing’s expansion of the Individual Visitor Scheme (IVS). Earlier in the year, the central government added eight mainland cities to the IVS list. Outgoing chief executive Ho Iat Seng praised this move, stating that it would “enhance the city’s capabilities to receive visitors [and] contribute to economic development.”
Ho emphasized that the MSAR would “fully seize the opportunities brought by this favourable measure.”
More Heads, More Beds
Anticipating an influx of visitors, casino resorts are expanding their accommodations, with a focus on luxury suites.
According to the Macau Daily Times, MGM Macau plans to renovate old VIP junket areas into luxury suites and guest villas. Sands China is also set to introduce 1,500 luxury suites at the Londoner Macau.
Next year, Galaxy Macau will unveil the exclusive Capella boutique hotel, featuring 57 suites and 36 sky villas. Additionally, SJM Holdings has announced plans to transform former VIP rooms at the Grand Lisboa Palace into luxury accommodations, complete with “exclusive villas, mansions, and suites,” enhancing guest experiences, according to chairwoman Daisy Ho.
As pointed out by the Citi team, “bigger hotel rooms attract bigger players,” and the increased accommodation supply will cater to the premium mass players who have taken the place of VIPs in this gambling hub.
Stabilizing the Economy
Yet, the growth in tourism remains dependent on consumer confidence amid a still-recovering Chinese economy, noted Jeffries analysts led by Anne Ling.
China’s consumer confidence index nearly reached a low of 86 in July. In late September, as reported by the South China Morning Post, Chinese President Xi Jinping called for “incremental policies,” including a reduction in interest rates, though it fell short of the more comprehensive stimulus package that investors were anticipating.
The Jeffries team stated, according to Seeking Alpha, “With 70% of [Macau’s] annual visitors coming from mainland China, the economic environment is crucial.” The team noted that “2024 was a challenging year for attracting tourists, with visa approvals for other destinations easing and airfares normalizing. Even so, visitor arrivals showed a 30% year-on-year increase for the first nine months of 2024, reaching 86% of 2019 levels.”
They added, “We expect a 5% increase in visitors in 2025. From 2025 onward, we anticipate the base effect to normalize. Moreover, both gaming and non-gaming infrastructure should continue to draw players and visitors.”