• Email Us: [email protected]
  • Contact Us: +1 718 874 1545
  • Skip to main content
  • Skip to primary sidebar

Medical Market Report

  • Home
  • All Reports
  • About Us
  • Contact Us

Billions blown as Macau casino investors fold amid gambling review

September 15, 2021 by David Barret Leave a Comment

September 15, 2021

By Farah Master and Donny Kwok

HONG KONG (Reuters) – Shares of Macau casino operators on Wednesday shed as much as a third of their value, losing about $18 billion, as the government kicked off a regulatory overhaul that could see its officials supervising companies in the world’s largest gambling hub.

With Macau’s lucrative casino licences up for rebidding next year, the plan spooked a Hong Kong market already deep in the red after Beijing’s regulatory crackdown on sectors from technology to education and property that sliced hundreds of billions of dollars off asset values https://ift.tt/3hrLsrH.

Wynn Macau led the plunge, falling as much as 34% to a record low, followed by a 28% tumble for Sands China. Peers MGM China, Galaxy Entertainment, SJM and Melco Entertainment all fell heavily, taking the drop to HK$143 billion ($18 billion).

U.S. casino companies also fell for the second straight day, losing as much as $4 billion in market capitalization on Wednesday, with Las Vegas Sands Corp slumping to more than a year low, Wynn Resorts Ltd and MGM Resorts International, dropping 8% and 5%, respectively.

The slump came after Lei Wai Nong, Macau’s secretary for economy and finance, gave notice on Tuesday of a 45-day consultation period on the gambling industry to begin from the following day, pointing to deficiencies in industry supervision https://ift.tt/3Agev8N.

Beijing, increasingly wary of Macau’s acute reliance on gambling, has not yet said how the licence rebidding process will be judged.

“Margins will be crushed at the gambling capital of the world and that will drag down all the big casinos,” said Edward Moya, senior market analyst at OANDA in New York.

Some Hong Kong stock analysts wasted little time in downgrading their view of near-term prospects for casino operators in the Chinese special administrative region, who must all rebid for licences when current permits expire in June 2022.

J.P. Morgan is downgrading to neutral or underweight all Macau gaming names from overweight, because of the tougher scrutiny on capital management and daily operations ahead of licence renewals, said analyst D.S. Kim.

“We admit it’s only a ‘directional’ signal, while the level of actual regulation or execution still remains a moot point,” he said, adding the news would have already put doubt in investors’ minds.

Brokerage CFRA downgraded Wynn Resorts to “Strong Sell” from “Buy”, citing heightened regulatory risks and said the review was a major overhang for the company as well as other operators.

TIGHTER REGULATION

At a news briefing on Tuesday, Lei detailed nine areas for the consultation, such as the number of licenses, better regulation and employee welfare, as well as having government representatives to supervise daily casino operations.

The government also plans to increase voting shares in gaming concessionaires for permanent residents of Macau, as well as more rules on transfer and distribution of profits to shareholders.

Discussions over the future of Macau’s casino licences come amid rocky U.S.-China relations, leaving some investors fearing an edge for domestic players over U.S.-based casino operators.

The government has not singled out any U.S. players, but companies have moved to beef up the presence of Chinese or local executives as they position themselves more as Macau operators than foreign one.

Before licence expiry, operators have tried to strengthen corporate responsibility and diversify into non-gaming offerings to placate Beijing, which fears over-reliance on gambling.

Macau has boosted scrutiny of casinos in recent years, clamping down on illicit capital flows from mainland China and targeting underground lending and illegal cash transfers.

Beijing has also stepped up a war on cross-border flows of funds for gambling, hitting the funding of Macau’s junket operators and their VIP customers.

In June, Macau more than doubled the number of gaming inspectors and restructured departments to boost supervision.

George Choi, a Citigroup analyst in Hong Kong, said while the public consultation document gave few details, the suggested changes benefit long-term sustainable growth, with “positive implications on the six casino operators”.

However, he cautioned, “We will not be surprised if the market focuses only on the potentially negative implications, given the weak investor sentiment.”

The consultation comes as Macau has struggled with a dearth of travellers because of coronavirus curbs since the start of 2020. While gambling revenues have picked up in recent months, they remain less than half of 2019 monthly figures.

($1=7.7785 Hong Kong dollars)

(Additional reporting by Donny Kwok, Shreyasee Raj, Kannaki Deka and Shreyashi Sanyal; Editing by Anne Marie Roantree, Clarence Fernandez and Arun Koyyur)

Source Link Billions blown as Macau casino investors fold amid gambling review

David Barret
David Barret

Related posts:

  1. Soccer-PSG sign two-year deal with fashion house Dior
  2. A curtain divides male, female students as Afghan universities reopen
  3. G20 urges COVID help for poor states, but short on new commitments
  4. China’s Aug export growth unexpectedly picks up speed, imports solidly up

Filed Under: News

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Primary Sidebar

  • “Something Unknown Is At Work Here”: Unexpected Results From NASA Mission To Deflect Asteroid
  • Dangerous Radiation Awaits Astronauts On Mars – New Mission Could Work Out Just How Much
  • A 4.9 Million-Year-Old Ecosystem Of Interconnected Worlds Is Preserved In A Tennessee Sinkhole
  • 100 Years Since The Scopes (Monkey) Trial: How Much Has Changed Since America’s “Trial Of The Century”?
  • Elephants Use All Kinds Of Gestures To Communicate – They Just Want Apples
  • NASA’s Parker Solar Probe Finds Evidence Of “Barrier” In The Sun’s 2 Million Kelvin Atmosphere
  • Watching Videos At Higher Speeds May Save Time But It Has Some Drawbacks
  • In 2008, Ukraine’s Space Agency Sent A Message To Planet Gliese 581c. It Will Arrive In 2029
  • In A First, A Robot Listened To Spoken Instructions And Performed Surgery – Just Like A Human Would
  • Newly Discovered “Bone-Digesting” Cells Help Burmese Pythons Consume Every Last Bit Of Their Prey
  • Gold Can Be Made By Scientists In A Lab – There’s Just One Problem
  • Recovery Of 24-Million-Year-Old Protein Fragments From Extinct Animal Opens “New Chapter” Of Biology
  • 6 Leading Medical Organizations Team Up To Sue RFK Jr Over COVID-19 Vaccine Policy
  • Less Ice, More Fire: Evidence Melting Glaciers Make Volcanic Eruptions More Explosive
  • This Mini Fridge-Sized Spacecraft Could Study A Time Of The Universe We’ve Never Seen Before
  • Psilocybin Shows Potential In Slowing Human Cell Aging And Increasing Lifespan In Mice
  • Blue Sharks’ Freaky Tooth-Skin Makes It Possible For Them To Change Color To Green And Even Gold
  • Summer In The Northern Hemisphere Will Be 15 Minutes Shorter Than Last Year’s
  • Your Ability To Be Funny May Not Be Inherited After All, And That’s Really Unexpected
  • New Interstellar Comet Tracked To Its Origin Region: “It’s Much Older Than The Solar System”
  • Business
  • Health
  • News
  • Science
  • Technology
  • +1 718 874 1545
  • +91 78878 22626
  • [email protected]
Office Address
Prudour Pvt. Ltd. 420 Lexington Avenue Suite 300 New York City, NY 10170.

Powered by Prudour Network

Copyrights © 2025 · Medical Market Report. All Rights Reserved.

Go to mobile version