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Macau's land-based casino business is going through hard times, as evidenced by GGR Morgan Stanley's revised forecast for 2021. According to new data from representatives of the banking group, their revenue will be $ 24 billion, which is 70% below the consensus forecast. Corporate EBITDA is expected to be just $ 6.4 billion. The main reason for the drop in income is the decline of the VIP sector.
Compared to 2019, VIP's revenue is down 60% while mass market revenue is down 20%. Thus, it is the VIP sector of the market that has the greatest impact on the overall GGR. In addition, China will introduce a new law prohibiting Chinese residents from organizing overseas gambling. On the other hand, this law makes it difficult for overseas operators to provide access to their gambling to the Chinese, so that eventually some of the funds must return to Macau.
While 2021 may not be a good year, the GGR could reach $ 47 billion in 2022. This is primarily due to the upcoming expansion of some gambling establishments in Macau. According to Morgan Stanley, since the shares may rise long before the events provoking a change in their value, 2021 may be an important year for improving the further dynamics of the shares' growth.
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