Possible increase in China's GDP  Hong Kong

 Will Macau shoppers be more inclined to spend money if China's GDP grows in the first quarter?  There may be a shortfall in funding if GGR in the gaming hub remains flat.
 In the first quarter, the Las Vegas Sands Macau casinos brought in MOP57.65 billion (£5.4 billion/€6.3 billion/$7.21 billion), an increase of 0.86% year-on-year.  According to the city's Gaming Inspection and Coordination Bureau, that approximately 60% was from mass-market baccarat. 

 Despite a 0.76 percent decline from 2023 to 2024, mass baccarat increased by about 15 percent from 2019 to the same time.  The MOP14.45 billion won by VIP baccarat players was up 0.54 percent from the previous year but down 61 percent from 2019.  

 During his remarks before the legislative assembly on 14 April, Macau chief executive Sam Hou Fai admitted that the government's objective of MOP240 billion, which necessitates MOP19.2 billion in GGR every month, will most certainly be unmet.   According to Sam, Macau "would immediately be running a budget deficit" for the year if revenues fall below that threshold.

 Tourists might be more inclined to spend money if China's stimulus programs pan out.  According to China Daily, which was published on April 18th, the biggest economy in Asia experienced a growth of 5.4% in the first quarter of the year, which was higher than the forecasted 5.2%. 

 The first-quarter GDP growth was characterised by Morgan Stanley strategist Xu Changtai as a "modestly positive indicator" of solid momentum.

 Elite clientele vs. mass market
 A reflection of the times is the move towards mass-market gaming.  The once-dominant VIP category has been hit hard by Beijing's increased crackdown on capital flight, unregulated money exchanges, and junket operations in recent years.

 According to Macao News, junkets used to make up as much as 60% of GGR. These trips include transportation, lodging, and casino credit for high rollers visiting Macau.  The arrest and prosecution of two business heavyweights on charges of illicit gambling and fraud marked the beginning of their demise.

 A prison term of eighteen years was handed down to Suncity boss Alvin Chau in 2023.  Levo Chan, founder of Tak Chun, received 14 years a few months later.  A change towards mass and premium-mass gambling occurred in Macau as a result of their convictions, which pushed some VIPs into hiding.  There have been just 24 junket operations in the city since 2014, down from 235.

 Q2 is expected to see a rise in growth.
 A weaker yuan and simmering US-China trade tensions are the factors that CSLA analysts Jeffrey Kiang and Leo Pan have identified as contributing to the decline.  Their forecast for GGR growth this year is 1.8%, coming in at a meagre MOP230.8 billion.

 According to their property team, Chinese property prices are expected to progressively bottom out in [H2 2025], which would have a significant impact on consumer confidence in the country. "Although we anticipate minimal growth in 2025, we anticipate this to accelerate in 2026," they stated.  In addition, they anticipate a 2.6% increase in 2025 and 2026 tourist to Macau, as well as a 4.6% increase in 2027.

 "Especially with heightened concern around any potential slowdown in Asia due to the Trump tariff regime and a potential US recession," says Vitaly Umansky, an analyst at Seaport Research, who predicts that the second quarter and the remainder of 2025 will be better for casino investors.

 The gambling equities, he continued, "remain intrinsically undervalued, particularly the Macau companies."  The growth in Macau has stalled, thus we have lowered our growth forecast for 2025.  However, we anticipate a quickening of growth in the year's second half...  He announced that the world's leading gaming market now expects GGR growth of 3%.