A record surge in COVID-19 cases across Malaysia as a result of the Omicron variant is unlikely to result in further lockdowns nor dissuade Malaysians from gambling, according to a note from Maybank IB Research.
Analyst Samuel Yin Shao Yang said Thursday that evidence from how other gaming jurisdictions around the globe had responded to Omicron outbreaks had “assuaged our fears” with Maybank maintaining its current earnings estimates. Malaysia recorded a record 27,831 new infections on Wednesday.
“We posit that Malaysians are still inclined to participate in gaming despite the risk of being infected with COVID-19, as long as the risk of serious health complications is low,” Yin wrote.
Looking overseas to the United States, United Kingdom and Australia, which all saw COVID-19 cases reach record highs in December and January, Yin said, “One would be forgiven for believing that gaming in these three countries would come to a screeching halt. To our positive surprise, interest in retail and recreational activities (which presumably includes gaming) in each of the three countries was only negatively impacted in a minor way. Positively, Las Vegas Strip gross gaming revenues (GGR) continue to trend strongly.
“While new COVID-19 cases have surged to record highs in these 3 countries due to the Omicron variant, new COVID-19 deaths have by and large not. This suggests to us that people are more inclined to participate in retail and recreational activities (including gaming) despite the risk of being infected with COVID-19 as long as the risk of serious health complications, including potentially death, is low.
“Thus, we are cautiously optimistic that Malaysians are still inclined to participate in gaming despite the recent Omicron wave.”
Maybank has maintained a “Buy” rating on Malaysian gaming stocks, which include Genting Berhad and Genting Malaysia.
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